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The Tearing Of Europe's Social Fabric

Tyler Durden's picture




 

We have long-discussed the growing concerns of a rising level of social unrest in Europe. Our go-to chart has been youth unemployment - and it still reigns supreme as the scariest chart for European leaders (no matter what they publically claim). JPMorgan's Michael Cembalest shares our concern as he opines on the potential for a tear in the social fabric in Europe.

 

Via Michael Cembalest, CIO JPMorgan,

Over the last couple of years, we have been watching the social fabric in Europe given 18% unemployment (and rising). With little growth on the horizon, it’s not clear how jobs will improve much, and what the long-term social implications will be.

 

Whether it’s Europe in the 1930’s or the US during the same period (conflicts between strikers, the National Guard and armed militias), unemployment can create a powerful cocktail of unrest.

So far, European demonstrations have been fewer than what one might have expected given the situation.

Could a mitigating factor in Europe be a better starting point vs. other countries?

“Quality of life” is hard to measure. There are organizations that give it a shot: the most detailed version we have seen is from the OECD. There are clear patterns in the OECD data: on issues related to work-life balance, life expectancy, environment, personal safety, family support network and life satisfaction, the Eurozone ranks ahead of the US. However, the recession does seem to be taking its toll: fertility rates, which were finally rising in Europe during the prior decade, declined sharply in 2011; according to the UK Economic and Social Research Council, suicides have been rising in Italy and the UK due to economic stress; and in Spain, there has been an increase in observed depression, anxiety and mood disorders (as per the Red de Actividades Preventivas y Promoción de la Salud en Atención Primaria). The imposition of regressive VAT taxes has also widened income disparities in many countries. Some of the same trends are observed in other countries which experienced a large recession, like the US.

While there may be increasing cracks in the social fabric, so far, concrete political manifestations have been limited. Despite the complaints that show up in Eurobarometer surveys, Eurozone citizens appear committed to persevering with the Euro despite the hardships. With the ECB doing the heavy lifting instead of national parliaments making large fiscal transfers, the perceived costs of the regionwide bailout seem low. No political party that clearly advocates Eurozone withdrawal have done well in national elections, not in the surplus countries in the North, nor in the deficit countries in the South (the closest would be the Movimento 5 Stelle, or M5S, in Italy). We have noted in the past the modest rise of rightist parties in some countries, but so far the political status quo is holding better than I thought it would. This is particularly true in Germany, where opposition parties are also pro-Eurozone, if not moreso. I suppose there’s still a long way to go, and that the impact of a generation of disenfranchised, jobless youths will take time to appear.

In 1992, the author of the German Constitutional Court opinion on Maastricht wrote the following:

“A Europeanisation without a prior European consciousness and therefore without a European people with a concrete capability and readiness for common statehood would be, in terms of the history of thought, un-European”.

Could it be that the social fabric in Europe is stronger than many perceive it to be, and that “Europeanization” has advanced a lot since 1992? Perhaps; but I am equally tempted to believe that Europeans simply recognize the financial and economic dangers of immediate dissolution, and remember the words of Benjamin Franklin: “We must all hang together, or most assuredly we shall all hang separately!”

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Fri, 02/01/2013 - 10:17 | 3205926 BlueCheeseBandit
BlueCheeseBandit's picture

"Wtf, why aren't we the center of their universe? A man should spend his entire life trying to be as attractive as possible to women and then wait in line like a good little chump while I decide which to pick."

Now you know why my generation has discovered the joys of masturbation.

Women have legs too, last I checked. I thought you were liberated. Start approaching guys if you wanna get fucked bad enough.

Fri, 02/01/2013 - 01:13 | 3205224 All Risk No Reward
All Risk No Reward's picture

I'm concerned folsk will get hungry and burn down their neighborhood.

Americans are being bankrupted by a financial weapon based on 5th grade math.

We really aren't that bright.

Talk to people whenever you are out and about.  Let them know who to blame when this flying pig goes splat on the ground.

Debt Money Tyranny

http://www.keepandshare.com/doc/4768883/debtmoneytyranny-6-1-pdf-60k?tr=77

$20 is lent to society @ 5% interest.

One year later $21 is owed, but society only has $20 unless they slave for the banksters or convey their wealth to the banksters.

America isn't sovereign, we are subjugated chumps that only think we are free.

We need a knew word for enslaved chumps that really think they are free.

Freedom dissonance?  That's not good enough.  Give me something good!

PS - Person/Group A's monetary wealth is, BY DEFINITION, Person/Group B's UNPAYABLE DEBT.

All the monetary wealth of Rothschilds, Rockefellers, the Transylvanian Royalty perched on the British thone (look it up, its true!), Queen Beatrix, Warren Buffet, Bill Gates, Oprah, etc... REPRESENT SOMEONE ESLE'S DEBT ENSLAVEMENT.

I'm saving money like crazy and I'm forced to be a debt slave master. 

IT

MAKES

ME

SICK

THESE PEOPLE ARE WICKED PSYCHOLOGICAL MONSTERS.

30 millions deaths per year due to malnutrition and starvation is a result of their POLICY DECISIONS to use their fraud and control over governments to deny resources to the people in those regions.

These nations are more like nantion state sized Warsaw Ghettos than most would like to consider.

If you think you are safe from these people - by my reckoning, they hate uppity, freedom loving Americans (you are serfs that need to be put into place) more than any other group on the planet.

They will lick their chops as they bankrupt you and useful idiot minions and peons will do all the work for them...  financed by the citizenry, of course.

It's sick, people... and it all requires our consent!

Weapons of Mass Debt

http://www.keepandshare.com/doc/4768883/debtmoneytyranny-6-1-pdf-60k?tr=77

Fri, 02/01/2013 - 01:40 | 3205277 Totentänzerlied
Totentänzerlied's picture

Breadcrumbs ... and publicly subsidized prophylaxis! http://i.imgur.com/AY9DiZS.jpg (SFW)

Forward Fabian Soviet!

Fri, 02/01/2013 - 01:48 | 3205281 Freddie
Freddie's picture

I think the Europeans syll are hopeful because they DON'T have Hope & Change.  

They can see what real hopelessness and despair is across the pond.

A bad day in most of Italy, Austria, Switzerland, Sweden (except Malmo), Denmark, most of Spain and even Greece beats a good day in Chicago or a lot of LA or Baltimore.

Fri, 02/01/2013 - 02:23 | 3205328 q99x2
q99x2's picture

By the looks of them we will have a long wait.

Thu, 01/31/2013 - 21:10 | 3204656 Moneyswirth
Moneyswirth's picture

Coming to a middle America near you...

Thu, 01/31/2013 - 21:26 | 3204698 davidsmith
davidsmith's picture

Not for a while I'm afraid.  But when it does happen in America, it will be as vicious as the Spanish civil war.  Our clerks, digi- and otherwise, will know very well how to shut down this country.  And a lot of private scores will be settled,as well.  It'll be hella nasty.  Our goombah underclass will do the LEAST part of the damage.  It's our clerks in the guts of the machine who will know just how to shut this mutha down.

Fri, 02/01/2013 - 01:16 | 3205240 All Risk No Reward
All Risk No Reward's picture

You mean the indebted to their eyeballs, pension lusting masses?

I'm not so sure can muster anything anything but "yes sir, how many rounds per zombie, sir?" to their criminal debt overlords.

I hope you are right, though, but these people who resist will be punished severely.

And their families.

Now is the time to prepare.  Not when it becomes "cool" to prepare.

Thu, 01/31/2013 - 22:30 | 3204866 max2205
max2205's picture

Politicians love peace and quite

Thu, 01/31/2013 - 23:43 | 3205056 yogibear
yogibear's picture

At more than 50% youth unemployment it shouldn't take much to ignite a revolt.

Fri, 02/01/2013 - 00:40 | 3205182 TBT or not TBT
TBT or not TBT's picture

Here's the even greater trouble in Spain and much of Europe:   50% of not much....is not much, versus whatever, 15% of not much in Germany or wherever else the percentage looks better.      

What do they both have not much of?   Youth.   Young people.  

These are demographic death bed economies with wild imbalances in the distribution of ages in the general population.   They are freakin old.   France not as badly as Germany, but get this, the French don't allow anyone to call out the percentage of native born people who are raised in arab/islamic slums.   It is a huge number, so big as to set France a bit above "replacement".

The youth may revolt or whine electronically en masse or all get extra stoned one day, but there aren't a lot of em.   Not much gonna happen in the sense of the younger generation going to civil war because there aren'y many of them.

Fri, 02/01/2013 - 04:22 | 3205411 Ghordius
Ghordius's picture

dead on +1, the biggest problem is not that so many are jobless, which is a tragedy waiting to unfold in the next decades, it's that there are so few of them. and in southern europe they are more often than not lavishly pampered by their extended families

Thu, 01/31/2013 - 23:47 | 3205063 Notarocketscientist
Notarocketscientist's picture

Do any EU countries have the = of Food Stamps?

Fri, 02/01/2013 - 00:40 | 3205183 TBT or not TBT
TBT or not TBT's picture

Name one that doesn't have a comprehensive welfare state since decades now.

Fri, 02/01/2013 - 04:36 | 3205424 Ghordius
Ghordius's picture

we have way more complex schemes. the US SNAP program is - by our dear socialists in europe - regarded as crude

you can't even imagine how detailed some of our welfare schemes are, with multiple safety nets and legions of state employees looking after minute differences in state support - and public TV discussions on things like "ok, *the internet* is a *(human) right*, but do they need a printer next to that pc, too?"

some of them quip that what Americans do is not welfare, it's just shooting dollars at the social problems in the hope they go eventually away

Fri, 02/01/2013 - 00:10 | 3205116 maskone909
maskone909's picture

im 30 And i have no fuckin idea what a hipster is. im assuming they are those little shits who wear ball strangling tight pants and ride one gear bicycles... your a long way from starbucks homie ***breaks jaw and smashes bike on face BAMM!! ****casualy walks away while listening to newly confiscated $500.00 headphones from unconscious body ZAPP!!

Fri, 02/01/2013 - 04:01 | 3205400 mt paul
mt paul's picture

fabric 

is for puppets...

real bears wear fur

Fri, 02/01/2013 - 05:03 | 3205442 dunce
dunce's picture

I suspect that the end game will be some small thing that starts to slide and quickly becomes an avalanche at which point countries and individuals will go every country and individual for them self. At some point all the phony shuffling of paper debt will lose its ability to calm markets. We have seen credit freeze just a few years ago and there have been no real structural changes to stop another crunch and the next big TARP, QE99 or some new acronym will just be ignored. Our leaders have proven that they really have no answers so some new leaders must be found when the feces goes airborne  which means political chaos.

Fri, 02/01/2013 - 05:10 | 3205446 Ungaro
Ungaro's picture

MASSIVELY BULLISH! EURUSD to $1.50, S&P to 2,000. Greater unemployment makes for better margins, lower wage pressures and a more productive workforce. Let the gummint pick up the tab, they will just print more!

</SARCASM>

Fri, 02/01/2013 - 09:42 | 3205831 orangegeek
orangegeek's picture

All socialists eventually run out of other people's money.

 

 

Fri, 02/01/2013 - 10:33 | 3206009 BlackVoid
BlackVoid's picture

Yeah, remember from a few years ago, all pundits were screaming: EU is collapsing, EUR is collapsing.

NO, IT IS NOT. Europe will not be the first to collapse.

Fri, 02/01/2013 - 13:06 | 3206565 AnAnonymous
AnAnonymous's picture

As time passes by, it appears that 'americans' residing in Europe have no other option but blobbing up.

Security in numbers: a capital datum when you run an extortion of the weak, farming of the poor business.

Welcome to the 'american' world.

Fri, 02/01/2013 - 13:30 | 3206672 TheFourthStooge-ing
TheFourthStooge-ing's picture

AnAnonymous said:

As time passes by, it appears that 'americans' residing in Europe have no other option but blobbing up.

Ah, very good, best to start with Chinese citizenism tried and true classic of blobbing up. Perhaps later you can regale us with a favourite Chinese citizenism fabled past mythology story of 'american' conquest of Eastern Island.

Security in numbers: a capital datum when you run an extortion of the weak, farming of the poor business.

Hmmmmm, too bad, a big let down after beginning so well. The whole farming of poor weak extorted stuff is somehow a bit overused, boring redundantly. Give time to thinking on new material is recommended.

Welcome to the 'american' world.

And a happy Chinese citizenism new year to you, my friend.

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