• Knave Dave
    05/23/2016 - 18:16
    This past Thursday marked the one-year anniversary of the US stock market’s death when stocks saw their last high. Market bulls have spent a year looking like the walking dead. They’ve...

For Germany, The Four Year Business Cycle Is Complete

Tyler Durden's picture


Next week will see a slew of key data releases across the Euro area. The week will kick off with the German Ifo for August due on Monday which Goldman expects to fall slightly, reflecting the softening in the August composite PMI.  The business climate index has been signalling a further loss of momentum in the German economy, with both key dimensions - the assessment of current conditions and business expectations - deteriorating since May. The chart below shows how both components have evolved during the European debt crisis. The 'expectations' component appears to have been particularly affected by European developments. As far as the sectoral breakdown is concerned, the Ifo was still signalling rather robust domestic growth in construction, and in retail and wholesale goods, while the manufacturing sector seemed to have been adversely impacted by a weakening in external demand. The 'flash' reading of the August manufacturing PMI for Germany, however, seems to indicate that this could be changing. As the chart indicates, between the survey's mediocre perspective of the current situation and its negative expectations for the future - we have completed the circle and stand back at precarious Mid 2008 levels - and we know what came next.

German IFO - charting current situation (y-axis) against futures expectations (x-axis) - shows we have almost completed the circle...


Chart: Goldman Sachs

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Fri, 08/24/2012 - 10:36 | 2733778 Fidel Sarcastro
Fidel Sarcastro's picture

Bullish, I'm sure

Fri, 08/24/2012 - 10:53 | 2733839 Precious
Precious's picture

If Goldman Sachs says its true, then it must be true.

Fri, 08/24/2012 - 10:37 | 2733782 Jlmadyson
Jlmadyson's picture

The circle of death.

Fri, 08/24/2012 - 10:54 | 2733842 Alea Iactaest
Alea Iactaest's picture

It looks a lot like a certain Greek island I've got my eye on.

Fri, 08/24/2012 - 10:37 | 2733785 malikai
malikai's picture

Let me guess. What comes next is green shoots, right?

Fri, 08/24/2012 - 10:40 | 2733791 TwoJacks
TwoJacks's picture

cool way to picture the business cycle, if that's what you're calling that

Fri, 08/24/2012 - 10:42 | 2733800 The Wizard of Oz
The Wizard of Oz's picture


Fri, 08/24/2012 - 10:44 | 2733808 Jason T
Jason T's picture

circle, cycle, wave .. it's all the same shit.  Tis the language of the universe.

Fri, 08/24/2012 - 11:05 | 2733891 Spastica Rex
Fri, 08/24/2012 - 10:47 | 2733812 LMAOLORI
Fri, 08/24/2012 - 11:02 | 2733880 Linus2011
Linus2011's picture

Greece will be done in october

Fri, 08/24/2012 - 10:49 | 2733826 GolfHatesMe
GolfHatesMe's picture

PPT 10:30 logon

Fri, 08/24/2012 - 10:55 | 2733850 Alea Iactaest
Alea Iactaest's picture

Did they all go to SBUX this morning? Or sleep in and miss the bell?

Fri, 08/24/2012 - 10:53 | 2733837 Tense INDIAN
Tense INDIAN's picture

talking about cycles....can someone list the best books on Market Cycles.....

Fri, 08/24/2012 - 10:53 | 2733841 Dr. Engali
Dr. Engali's picture

Is that a formula one track?

Fri, 08/24/2012 - 10:55 | 2733849 Precious
Precious's picture

Watch out for the moat at the end of the first lap.

Fri, 08/24/2012 - 11:07 | 2733894 Temporalist
Temporalist's picture

Damn I just said that below...

Fri, 08/24/2012 - 10:56 | 2733846 Linus2011
Linus2011's picture


Is that the american "guvernment" protected mafia organization that wants to buy german stocks cheap saying they are overrated at PE ratios of 6?

stopido americanos always tend to believe that kind of propaganda.

None of that bullshit seems true especially not here in south germany. well i must be living in a different germany then.


Fri, 08/24/2012 - 10:55 | 2733848 Dapper Dan
Dapper Dan's picture

Flash crash on the dow!


Fri, 08/24/2012 - 11:01 | 2733874 ar01
ar01's picture

If I'm interpreting this graph correctly, it perfectly highlights the bullish-bias in finance. There are simply more points where expectations > actual observation. 

Fri, 08/24/2012 - 11:22 | 2733890 Temporalist
Temporalist's picture

That chart looks like the Nürburgring of Hell

Fri, 08/24/2012 - 11:10 | 2733906 Winston Churchill
Winston Churchill's picture


Fri, 08/24/2012 - 11:14 | 2733924 GMan_
GMan_'s picture

BTFD. :) Look at SPX today. It's going up like there's no f*cking tomorrow.

Fri, 08/24/2012 - 11:16 | 2733932 economicfreefall
economicfreefall's picture

When I see anything with Goldman sucks on it, I know to stay as far away as possible before they slice and dice me into an OTC derivative and sell me a hundred times over to the same client.


Fri, 08/24/2012 - 13:20 | 2734348 mickeyman
mickeyman's picture

Past performance is no guarantee of future failure.

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