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Europe Back To 19th Century Growth Rates

Tyler Durden's picture




 

Long-term growth conditions in Spain, Italy and France are as weak as they have been (other than during wartime) in over a century. The chart below tells the story. As JPMorgan's Michael Cembalest notes, while European sovereign debt spreads have rallied across the board, European bank lending to households and businesses is still declining, and the cost of small business loans in Italy and Spain is higher than both real and nominal growth. With ECB policy now clearly useless given Europe's fragmentation, and with Germany's forward expectations rolling over, it is hard to see how, absent wholesale devaluation and/or inflation (or as Cembalest notes destruction & rebuilding), Europe will recover from this.

 

 

Charts: JPMorgan

 

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Mon, 04/01/2013 - 12:23 | 3396169 SheepDog-One
SheepDog-One's picture

Better than expected!!

Mon, 04/01/2013 - 12:27 | 3396183 DJ Happy Ending
DJ Happy Ending's picture

I am long fiefdoms and the dark ages

Mon, 04/01/2013 - 12:29 | 3396201 McMolotov
McMolotov's picture

Yes, Europe is back to 19th century growth rates and headed for 13th century feudalism.

Mon, 04/01/2013 - 12:45 | 3396228 BaBaBouy
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And The ONLY WINNER In This Fecking Debacle IS ....................

 

King Of EVERY Market ... SacksManGOLD ...

Mon, 04/01/2013 - 12:55 | 3396269 BaBaBouy
BaBaBouy's picture

OT ...

Noat ... Plat & Pal Soaring On Russian Plan For Cartel Type.

AU & AG will rocket when CB's Lose Cuntrol ...

 

Mon, 04/01/2013 - 13:15 | 3396381 redpill
redpill's picture

More OT.

 

New ad "He weighs 170.  He benches 420."

Maybe so, but the ZH comment section will still drink you under the table, pussy! 

Mon, 04/01/2013 - 13:24 | 3396428 pods
pods's picture

But what is his personal best in the Dwarf Toss?

pods

Mon, 04/01/2013 - 12:58 | 3396287 Dr Paul Krugman
Dr Paul Krugman's picture

We should go back on a gold standard (wonkish).

Europe’s Second Depression:

http://krugman.blogs.nytimes.com/2013/03/29/europes-second-depression/

Mon, 04/01/2013 - 13:08 | 3396351 DoChenRollingBearing
DoChenRollingBearing's picture

Krug-girl!

That's because they are not Socialist enough.

Mon, 04/01/2013 - 13:13 | 3396378 Ahmeexnal
Ahmeexnal's picture

War is Peace!
Freedon is Slavery!
Ignorance is Strength!
Debt is Wealth!
Real Wealth is a Barbarous Relic!
Retreating is Advancing!
Backwards is FORWARD!

Mon, 04/01/2013 - 13:31 | 3396461 slightlyskeptical
slightlyskeptical's picture

The difference is who the printing was for. In the 30's the printing was used to rebuild. Today the printing is to bail out banks and an economy that cannot stand on it's own.  Fed policies are propping up a failed system. Let's get real the conomy right now is nothing but a redo of "Weekend at Bernie's"

Mon, 04/01/2013 - 14:45 | 3396712 tarsubil
tarsubil's picture

What is wonkish about that article? BS stats thrown up next to each other. Wow, very impressive. Don't you get tired of carrying all the secrets?

Mon, 04/01/2013 - 12:39 | 3396232 Sudden Debt
Sudden Debt's picture

the only problem is that there's a few more people since the 19th century....
how... could they... FIX THIS?!?!?

Mon, 04/01/2013 - 12:43 | 3396239 McMolotov
McMolotov's picture

Need. Moar. War.

(Woar?)

Mon, 04/01/2013 - 12:45 | 3396248 Sudden Debt
Sudden Debt's picture

THE GREAT ALIEN WARS!!!!

Only problem is... where are they?
are we alone after all?.... this is... not good...

E.T. !!! STOP PHONING HOME AND GET YOUR BATTLECRUISERS OVER HERE!!!

Mon, 04/01/2013 - 12:48 | 3396258 DoChenRollingBearing
DoChenRollingBearing's picture

Paul Krugman supports your message.  Alien battlecruisers would break lots of windows over in Europe.

Mon, 04/01/2013 - 13:16 | 3396394 Ahmeexnal
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USSS LeMay is about to launch a few more "meteorites" like the one hurled at Chelyabinsk a few weeks ago.

Mon, 04/01/2013 - 14:38 | 3396672 RafterManFMJ
RafterManFMJ's picture

Just need a shower of asteroids. They break windows. Um, set them to explode in the atmosphere though...impact is not so good.

Mon, 04/01/2013 - 12:47 | 3396256 redpill
redpill's picture

WE'VE ALWAYS BEEN AT WOAR WITH EASTASIA

Mon, 04/01/2013 - 12:52 | 3396265 Mototard at Large
Mototard at Large's picture

Unfortunately, if this keeps going we might get more war....  Having attended a war once while wearing a uniform and carrying a gun, I do  think this whole war thing is over rated.  Systemic war at the Euro/North Atlantic level will do no one good.

Mon, 04/01/2013 - 12:44 | 3396247 francis_sawyer
francis_sawyer's picture

BITCOINS are certain to put us all back on track to the UNLIMITED GROWTH ON A FINITE PLANET paradigm...

Mon, 04/01/2013 - 12:48 | 3396254 DoChenRollingBearing
DoChenRollingBearing's picture

+ $101 for sarcasm that even a Bearing can understand!

Mon, 04/01/2013 - 13:21 | 3396416 francis_sawyer
francis_sawyer's picture

"101' [or was it "102", I forget]... I see what you did there :-)...

Mon, 04/01/2013 - 12:51 | 3396257 Sudden Debt
Sudden Debt's picture

That answer deserves a mMONEY PRICE!!!

wait.. let me create some money for you...

HOCUS!!!

POOCUS!!!

PATS!!!!

HERE ARE... 50 BITCOINS FOR YOU!!! >>°*0011101101<<<

just print this text and show it when you go shopping... I'm sure you'll be able to pay your groceries with it...

Mon, 04/01/2013 - 13:49 | 3396523 Ghordius
Ghordius's picture

mhh... "19th century growth rates and headed for 13th century feudalism" in both centuries we had a few free cities

Mon, 04/01/2013 - 12:35 | 3396218 Jonas Parker
Jonas Parker's picture

Note to self: buy "Serf Torch & Pitchfork Co." shares...

Mon, 04/01/2013 - 12:52 | 3396267 Sudden Debt
Sudden Debt's picture

IF YOU DON'T HOLD THE TORCH AND PITCHFORK, YOU DON'T OWN IT!!

Mon, 04/01/2013 - 12:32 | 3396208 Martial
Martial's picture

Yep this is bullish all the way!

Mon, 04/01/2013 - 12:24 | 3396173 Ancona
Ancona's picture

Depression.....not just for depressed people any more. I wonder how long before this shit is happening here?

Mon, 04/01/2013 - 12:54 | 3396275 Sudden Debt
Sudden Debt's picture

... you guys have OBarry to save you all...

so... America... 110% debt to GDP... a industry base that makes... whatever... and a lot of...

WHATEVER!!! YOU'LL BE FINE!!

Mon, 04/01/2013 - 13:00 | 3396313 pods
pods's picture

Take away our monetization of 8-10% of GDP yearly, and, ummm, about 5 years ago.

pods

Mon, 04/01/2013 - 13:10 | 3396362 DoChenRollingBearing
DoChenRollingBearing's picture

@ Ancona

Kind of makes you wonder how many people in Europe are depressed.

And then what will happen here (which will happen after FRANCE goes down)?

Mon, 04/01/2013 - 13:17 | 3396397 Sudden Debt
Sudden Debt's picture

We'll be fine here in Europe...

WE'LL ALWAYS HAVE ALCOHOL AND NO MORAL STANDARDS THAT ARE BORING!!

Mon, 04/01/2013 - 13:46 | 3396514 DoChenRollingBearing
DoChenRollingBearing's picture

Doesn't do a Bearing much good that gave up drinking...

Mon, 04/01/2013 - 13:18 | 3396405 Ahmeexnal
Ahmeexnal's picture

Zoloft in high concentrations is being added to the water supply (along with fluorides, estrogens, and other "FREE" goodies).

Mon, 04/01/2013 - 14:44 | 3396701 RafterManFMJ
RafterManFMJ's picture

Sweet! Add moar Estrogen! I've always wanted my own set of tig ol' bitties!

Mon, 04/01/2013 - 12:24 | 3396175 Jason T
Jason T's picture

fascinating ... yeah, productivity, which is gotton from REAL INVESTMENT where WORK is required is poor and hence, you get shitty productivity growth.  Europe is done for and US productivity mind you sucks too... it's only Asia that is rising for real.

Mon, 04/01/2013 - 12:27 | 3396191 q99x2
q99x2's picture

Destruction and rebuilding. Dudes probably depressed that the asteroid missed us.

Mon, 04/01/2013 - 12:28 | 3396197 WTF_247
WTF_247's picture

Thats as bullish a signal as I have ever seen.  EURUSD should trade to at least 1.6 on that, European debt prices should rocket as should stocks - all in.

Mon, 04/01/2013 - 12:33 | 3396212 otto skorzeny
otto skorzeny's picture

ECB does not have ability to print the shit out of their currency like The Fed-does that make it more valuable in and of itself?

Mon, 04/01/2013 - 12:31 | 3396206 Yen Cross
Yen Cross's picture

    I guess this means JPMorgue is now short European sovereign debt.

Mon, 04/01/2013 - 12:35 | 3396207 JustObserving
JustObserving's picture

Europe should hire some US BLS (Bureau of Labor Statistics) personnel.  They are experts at creating the growth you want - especially through hedonic adjustments.

Mon, 04/01/2013 - 12:34 | 3396214 the not so migh...
the not so mighty maximiza's picture

1862 was a good year for playing the hermonica

Mon, 04/01/2013 - 12:38 | 3396229 Navymugsy
Navymugsy's picture

All we need is some black plague and we are on the road to recovery!

Mon, 04/01/2013 - 13:17 | 3396399 WTF_247
WTF_247's picture

That would be mega-bullish. Imagine how the unemployment levels would drop if half the population died.  Plus get rid of the older generation that is "taking" - in the ground = more for the rest of us.  

SS solved.  Disability = solved.  Medicare = solved. Old people taking jobs from younger workers = solved

Man - this seems almost like a Cinderella scenario ...

Mon, 04/01/2013 - 15:04 | 3396783 machineh
machineh's picture

If black plague don't exist, we'll have to invest it.

Mon, 04/01/2013 - 16:01 | 3397037 Svendblaaskaeg
Svendblaaskaeg's picture

"All we need is some black plague.."

No thank you, I take white, like my men (Airplane, modified quote)

Mon, 04/01/2013 - 12:39 | 3396231 kito
kito's picture

such a shame they dont have an agressive, competent, focused and GENEROUS central bank master like we do..........................

Mon, 04/01/2013 - 12:53 | 3396274 Mototard at Large
Mototard at Large's picture

Derivatives are financial weapons of mass destruction which could unwind during a crisis. Here is a simple explanation of what they are and why they can be both good and dangerous. It is written in plain language by ex-central bankers for a non-specialist audience. With the current “difficulties” in Cyprus about to spread, it will be curious to see if derivatives raise their ugly heads again. Who knows how much exposure the TBTF banks have once things unwind a bit?

http://tinyurl.com/blhtc3q

Mon, 04/01/2013 - 12:54 | 3396277 bagehot99
bagehot99's picture

Who knew the EU would invent time travel? They're taking their people Back!! To the future!!!!

Mon, 04/01/2013 - 16:04 | 3397061 Svendblaaskaeg
Svendblaaskaeg's picture

"Who knew the EU would invent time travel? They're taking their people Back!! To the future!!!!"

Soon they will invent fire - ehhh wait, Al Gore says fire is a no-no

Raw fish Bitchez!

Mon, 04/01/2013 - 13:01 | 3396297 Edward Fiatski
Edward Fiatski's picture

I haven't encountered any horseshit on the streets of London & Milan yet, so I guess all is well.

Edit: Scratch that - doesn't apply to London, they still live in Victorian times, and yes, the aforementioned features are present on the streets there.

Mon, 04/01/2013 - 13:05 | 3396335 pods
pods's picture

Am I the only dirty bastard that had Prima Nocta pop in his head?

pods

Mon, 04/01/2013 - 13:05 | 3396337 NoWayJose
NoWayJose's picture

They won't technically devalue, but they will try to weaken the Euro, and a weaker Euro will cause hidden inflation in commodities, food and energy. As Japan has shown, and the EU and US have shown more recently, all these higher costs choke off any economic recovery and actually hurt employment. And as we have learned, economies do not recover with moar QE!

Mon, 04/01/2013 - 13:12 | 3396367 The Dancer
The Dancer's picture

Here's a 1st hand report from SEA...I am back-packing around Thailand, etc. right now...have been for about 4 months...I've been staying in Guest Houses with young Europeans(25-40) from all over southern Europe. I talk/discuss/debate with guys and gals from Italy, Spain, France, Eastern Europe, Russia, etc...I enjoy primary research...going to the source. Italians and Spainards are leaving their home country looking for any kind of work to survive on. Young educated Russians tell me that they have to stay with their parents to make ends meet, when they can find work. The educated Chinese that I meet seem to be getting along somewhat better--I've met two different young Chinese men who actually quit their job to travel because they felt that they could get another one upon returning to China. One other note, the Thai Baht has appreciated about 4% vs. the US$ since I arrived. Not good for us travelers. lol

Mon, 04/01/2013 - 13:15 | 3396369 virgilcaine
virgilcaine's picture

Why they are Euro-peons.  They all think they are wealthy or some kind of royalty.. Ie the French who loaned all their money to Greece... hehe.

Mon, 04/01/2013 - 13:15 | 3396389 NoWayJose
NoWayJose's picture

History will show that the two lowest growth rates and greatest suffering for Europe were during and following the Black Plague of 1347 and the Banker Plague of 2010.

Mon, 04/01/2013 - 14:25 | 3396637 B2u
B2u's picture

QE1862 !!!

Mon, 04/01/2013 - 15:58 | 3397029 Joe A
Joe A's picture

Soon accompanied by 19th century working and living conditions.

Wed, 04/03/2013 - 10:52 | 3403234 jubber
jubber's picture

Ideal time to bring back Madame Guillotine

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