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Europe's "Recovery" Leaves 25% Of Spanish, Greek Workforce Unemployed

Tyler Durden's picture




 

How can this be possible? Bond yields are at record lows and stock prices near record highs across Europe and even the ever-increasing debt-to-GDP characteristics of the perennially weak periphery are able to issue bonds willy-nilly as if nothing had ever happened. So how come 18.9 million people across Europe were unemployed in the euro area in March? Spain - actually trading at its cheapest cost of funding of all time (below 3%) - accounts for 6 million of those. As Bloomberg's Niraj Shah notes, Greece and Spain have the highest jobless rates in Europe at 26.7% and 25.3%, respectively. That contrasts with 4.9% in Austria. The overall unemployment rate was unchanged at 11.8% in March from February after the previous month’s read as youth unemployment continues to rise.

 

 

Welcome to the totally manipulated "markets" where indicators have no signal quality anymore except to perpetuate an entirely false hope that the status quo is attainable once again and sustainable going forward.

 

For a brief month or two, Spain's unemployment data fell - rekindling belief in the miracle (thanks to participation rate shenanigans) but now as yields push below 3% for the first time, it is re-accelerating....

 

Charts: Bloomberg

 

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Fri, 05/02/2014 - 09:24 | 4719719 kaiserhoff
kaiserhoff's picture

Europe's "recovery" seems to be entirely due to Abe buying up all the paper in the world.  We can see how well that's working for Japan.  Look out below.

Fri, 05/02/2014 - 09:27 | 4719732 fonzannoon
fonzannoon's picture

The spanish 10yr ticked under 3% earlier today. Fascinating

Fri, 05/02/2014 - 09:31 | 4719749 eucalyptus
eucalyptus's picture

Absoultely insane. 

Fri, 05/02/2014 - 09:57 | 4719855 NoDebt
NoDebt's picture

I'm gonna take a shot at this....

Spain has 25% unemployment, but inflation in Euro-using countries is 1% (maybe even less).

USA has 18% unemployment (but we lie and say it's 6.3%) and inflation is in the range of 4% (again, we lie and call it 2%).

Now, given that central banks will never let either the US or Spain default, how crazy are those yields really when you compare them to eachother?

Fri, 05/02/2014 - 09:59 | 4719877 Haus-Targaryen
Haus-Targaryen's picture

The fundamental difference though my friend --

The USSA has its very own central bank that can and will set its own monetary policy.  Spain is unable to set its own monetary policy. While I agree with you re; USSA -- it will never properly default, the FED will destroy the USD before the Treasury actually goes bust. 

Spain however is a different story.  While I have no doubt that the ECB will pull all kinda of tricks out of its hat to stave off a Spanish default -- Spain is one political-krakatoa moment away from open economic rebellion and debt repudiation. 

Fri, 05/02/2014 - 10:04 | 4719898 eucalyptus
eucalyptus's picture

Jon Corzine, is that you? Sorry your timing was poor at MF. :)

Fri, 05/02/2014 - 10:32 | 4720018 HardAssets
HardAssets's picture

High unemployment, austerity, and loss of sovereignty to banksters in a foreign land . . .

now why did Ukraine want to join the EU ?

Afterall, it sounds like such a great deal for the people. <sarc>

Fri, 05/02/2014 - 09:28 | 4719733 Haus-Targaryen
Haus-Targaryen's picture

This is simple to explain. 

.

1. Fed prints a ton of dollars.  Loans USD to Euro banks at next to no interest.

2. Euro banks purchase sovereign tbills with fresh USD. 

3. Euro banks then use sovereign tbills als security for loans from the ECB.

4. Use fresh EUR to purcahse more sovereign tbill.s 

5. Repeat.

6. ????????

7. PROFIT!

Fri, 05/02/2014 - 10:54 | 4720154 BeanusCountus
BeanusCountus's picture

Amazing.  Because in theory the Euro banks can continue getting fresh EUR and again going back in and buying another round of sovereign tbills.  Over and over to continue to the low interest rate suppression on the sovereigns.  If I might ask, how might the transaction where the loan of the newly FED created USD to Euro banks be accomplished?

Fri, 05/02/2014 - 09:28 | 4719735 Racer
Racer's picture

It proves that the 'markets' are totally unrelated to real life

Fri, 05/02/2014 - 09:37 | 4719772 Doom and Dust
Doom and Dust's picture

Can't fault you for it, but you yanks just don't seem to realize the unemployment rates in these former military dictatorships in Europe have hovered around 20-30% for decades, owing in large part to a huge black and grey sector. You cannot compare these figures and countries with post-industrialized nations, even if the post-euro boom temporarily painted over the cracks in these semi-third world countries.

Fri, 05/02/2014 - 09:42 | 4719775 Boomberg
Boomberg's picture

Were people "employed" in the 18th century before the industrial revolution and the modern banking system and economic measurements? Or did they just go about with their lives farming, shopkeeping, fucking, and sleeping? Grecians and Spaniards enjoy your new lives and the dawning of a new day, when "employment" and GNP statistics will be soon be remembered as one of the ugliest chapters in human history (if we survive). 

Fri, 05/02/2014 - 09:51 | 4719830 Haus-Targaryen
Haus-Targaryen's picture

Yes, damn those "maths..."

Who need objectivity?  Totally useless. 

Fri, 05/02/2014 - 09:42 | 4719785 ebworthen
ebworthen's picture

Sounds like the U.S. "recovery" too.

In a world of lies telling the truth is heretical.

Fri, 05/02/2014 - 11:33 | 4720369 homonohumanus
homonohumanus's picture

It is a matter of understanding our social condition. We are social beings, you can tell a truth "alone", lies are another type of beast they require a tacite agreement the one lied and the one lying.

 

You are an asocial bunch lol

Fri, 05/02/2014 - 09:54 | 4719850 lemarche
lemarche's picture

GREAT TIME TO BE BUYING SPANISH BONDS !!

 

LOL.................

Fri, 05/02/2014 - 11:00 | 4720188 laomei
laomei's picture

I believe that's called a "depression" at this point now.

Fri, 05/02/2014 - 11:04 | 4720202 GoldIsMoney
GoldIsMoney's picture

Central banks and politicians do everythign they can to prolongue the crisis. The longer it takes the harsher the civil rights violations. And that is not something the politicians do despise.

Fri, 05/02/2014 - 11:57 | 4720489 Youri Carma
Youri Carma's picture

Actually 26% because Spain's jobless rate rises to 25.9% from 25.7% http://www.marketwatch.com/story/spains-jobless-rate-rises-slightly-ine-2014-04-29

Fri, 05/02/2014 - 14:14 | 4721125 adonisdemilo
adonisdemilo's picture

What do you expect when Europe is (mis) managed by a bunch of Keynsian theorists, most of whom just happen to be ex, read has beens, communists.

Not one of them will have had any real experience of commerce, especially actually producing ANYTHING that could be sold, and willingly bought by anybody, at a profit.

Sooner, hopefully not later, the hoi polloi will remember 1789 and repeat the history that TPTB seem so willfully ignorant of.

Fri, 05/02/2014 - 15:19 | 4721421 Yttrium Gold Ni...
Yttrium Gold Nitrogen's picture

This is a two-part documentary by VICE about Greece and new cheap drug they call "Sisa" that emerged due to collapse of the Greek economy.

Part 1
Part 2

I hope this is not what awaits Ukraine.

Do NOT follow this link or you will be banned from the site!