Euro zone falls into second recession since 2009

Comments (54)
madmonkey wrote:

Whew,that’s a relief. When the US economy tanks, Obama will have something to blame it on.

Nov 15, 2012 8:13am EST  --  Report as abuse
AZreb wrote:

“….social tension was not part of the equation” said one economist. That, itseems, is the problem with the economists and governments and their “solutions” – the people as parts of the solution are not considered. The governments and economists do not lose, no matter how bad things get for individuals – those who make up the populace and are drastically affected by loss of jobs, homes, education and any type of social help.

Nov 15, 2012 8:15am EST  --  Report as abuse
triumph900 wrote:

The EU was awarded the Nobel Prize for peace this year. Did no one notice the rioting that took place over cuts to social programs or the anger among member nations over who would fund the bail-out of bankrupt nations, or the desire of debtor nations to leave the EU and return to their own currencies. Now, after all that, the EU is falling back into recession which will likely begin a new round of austerity.

Sadly, America is following the European fiscal path downward and far

Nov 15, 2012 8:21am EST  --  Report as abuse
nobleone101 wrote:

Years and years of excessive government. Socialism has never worked, yet they keep heading down the same path.

Nov 15, 2012 8:23am EST  --  Report as abuse
gameover22 wrote:

Double dip? Never left the depression. Bankers now hammering in final nails on the global economy’s coffin. And everyone thought the ‘New World Order’ people were conspiracy kooks. Not anymore.

Nov 15, 2012 8:31am EST  --  Report as abuse
TomCoyne wrote:

During the run-up to acceptance of EURO by Ireland in particular, by other European states in general, but mostly since adoption of EURO by these same nations, I have been using one word to describe it: DISASTER.

EURO is a disaster for all of Europe and beyond and, of course, for all Europeans. Why, one might ask? Because it is structually unsound. From a monetary policy standpoint EURO is structured to fail; from a fiscal policy standpoint EURO is structured to fail. It is really that simple. The structure of EURO is so bad from an academic and empirical standpoint one wonders if it was designed to fail on purpose?

EURO is similar to building a house and touting its beauty when all parties concerned with construction know the house foundation has numerous fault lines, has numerous holes in soft dirt, has no chance to withstand a storm. Why in God’s name would anyone, anywhere want to do such a thing?

My prayer for my cousins in Ireland in particular is that they withdraw from EURO as quickly as possible. Ireland, for example, has a VERY positive Balance of Trade. Ireland as an independent state made it before and can make it again, but not if Ireland has to support out of conrol spending elsewhere. This same statement holds for other European countries.

Nov 15, 2012 8:34am EST  --  Report as abuse
chipgiii wrote:

I can’t help but wonder how much longer some of these nations will remain in the EU. Greece is fighting spending cuts tooth and nail, lowering their debt seems to be very difficult. They keep seeking help from the more solvent nations….how much longer will that help be available?

Nov 15, 2012 8:38am EST  --  Report as abuse
Lakenorman wrote:

Keep spending you clowns.

Nov 15, 2012 8:38am EST  --  Report as abuse

Euro recession? No problem, just copy Obama’s policies:

Borrow lots of money and then spend it!

Nov 15, 2012 8:43am EST  --  Report as abuse
Mike_Lynn wrote:

In the article Paul De Grauwe, an economist with the London School of Economics said: “It [the recession] is a result of excessive austerity…” This is the kinda stink’en think’en that has tripped up the southern Europeans for the longest time. You simply cannot have enough austerity. You buy (spend) based on income. If you don’t have the funds, you defer buying until you do can pay for it. Simple! It works every time for private families and governments.

Nov 15, 2012 8:46am EST  --  Report as abuse
mrrationalhbg wrote:

This is what austerity buys you. Clearly the GOP in the USA haven’t figured that out yet.

Nov 15, 2012 8:46am EST  --  Report as abuse
Demstruction wrote:

Rumor has it second term Obama is going to be blaming first term Obama.

Nov 15, 2012 8:49am EST  --  Report as abuse
Demstruction wrote:

Rumor has it second term Obama is going to be blaming first term Obama.

Nov 15, 2012 8:49am EST  --  Report as abuse
Changes2000 wrote:

Does anyone surprise about this back to back second recession? Politicians have no will to do anything that might anger voters and the general public wouldn’t care about anything problem as long as “benefits” continue to flow their way. Democracy is malfunctioning when selfishness rules everything. American is next.

Nov 15, 2012 8:49am EST  --  Report as abuse

Let the EU come unglued. As soon as groups of people (countries) focus on their issues and problems — and live within their means — they will be fine. Letting Germany run the place gets them exactly this.

Nov 15, 2012 8:51am EST  --  Report as abuse
ali3n wrote:

Again, astounding front page news, who would ever have thought this could happen when things were going so well. At least, according to our Chump in Charge, it can’t happen here because everything is getting better. So not to worry, EU may be in recession but lets keep up the waste and spending here because we are doing fine. Sarcasm off, cynicism on, I am sort of glad the chimp in chief won the election, because I want him to finally realize how incapable he is of turning anything around. I am looking forward to his increasing use of F shoe polish to cover the gray hair and watching him stammer and stutter as he tries to lie his way out of his incompetence. Good luck Bammy, you own this.

Nov 15, 2012 8:53am EST  --  Report as abuse

To recover from this recession, Europe needs to take a lesson from Obama.

Borrow lots more money, then spend it.

Nov 15, 2012 8:55am EST  --  Report as abuse
BuggyBob wrote:

And we are left to wonder: if this more 1933 or 1917?

We are on our own–this will get ugly.

Nov 15, 2012 8:58am EST  --  Report as abuse
MrSirGareth wrote:

This is the model our leftists hold up for us to imitate. Why don’t we become more like the Europeans they cry. One wonders why we even fought a revolution against giant government. Why did we fight the evil of communism for over 75 years only to vote for it at the poles. Then again when more than half the people make their loot by robbing the bank I’m sure we will see bank robbery decriminalized.

I outlived my nation.

Nov 15, 2012 8:59am EST  --  Report as abuse
reality-again wrote:

No monetary policy, or fiscal policy, or combination of both could solve the EU’s problems, and the focus on Draghi and the ECB is misplaced.
Europe suffers from a dysfunctional currency that’s warping its economic space and creating unsustainable conditions.
Europe also suffers from a major cultural and political problem known as the ‘welfare state’ – a system that’s no longer economically sustainable in most EU countries.
Can the Europeans solve these problems? Theoretically yes, but practically, most of them are used to think as citizens of their countries and not of the EU.
Furthermore, the institutions and incentives for solving major crises such as this simply don’t exist. The focus on Germany is therefor misplaced as well.

Nov 15, 2012 9:05am EST  --  Report as abuse
DanBAustin wrote:

The solution that Greece and others insist on implementing is the same thing that created the problem in the first place — spending money they don’t have.

It’s a lot like selfish, immature children who keep insisting that their parents buy them expensive toys that they can’t afford. The children throw tantrums and make threats until their weak parents give in and give them what they want. But the immature, demading children always want more. Eventually, the parents run out of money and credit, and no one will loan them any more money, They end up on the street penniless and starving, while the children still demand more from what they see as their selfish, uncaring parents.

Good luck with your ‘solution’ of spending more money you don’t have, we in the US are not far behind.

Nov 15, 2012 9:07am EST  --  Report as abuse
eddiethegeek wrote:

Governments making promises that they can never hope to fulfill? Coming to a neighborhood near you soon!

Nov 15, 2012 9:13am EST  --  Report as abuse

So monetizing the debt didn’t work. So in typical socialistic fashion let us double down on stupid and prolong the inevitable.

Nov 15, 2012 9:17am EST  --  Report as abuse wrote:

But wait! Isn’t socialism the path to the Workers Paradise? Forward!

Nov 15, 2012 9:27am EST  --  Report as abuse
p3orion wrote:

“The EU was awarded the Nobel Prize for peace this year.”

Well, triumph, at least the EU had been around for more than three weeks.

Nov 15, 2012 9:27am EST  --  Report as abuse
godsmotive wrote:

Europe is full of people willing to eat the seeds of next years planting for today’s meal. They are a lot like the people of the United States in this regard. They are demanding that their governments implode their economies so that they don’t feel the effects of reality and quite frankly, the collapse that is coming is well deserved on both sides of the Atlantic.

Nov 15, 2012 9:30am EST  --  Report as abuse
morphysmith wrote:

Obama will have the US next to Europe in the Recession column next year.

Nov 15, 2012 9:31am EST  --  Report as abuse
godsmotive wrote:

What is even more remarkable is that as the economies fail the truly stupid among us will claim that austerity is the cause. I hope you starve to death waiting in line for that government handout.

Nov 15, 2012 9:32am EST  --  Report as abuse

Spending more than they had, for decades, has pushed Europe into another recession, as the painful cuts to reduce excessive spending hit people hard. Europe’s economic model of punishing business, slow growth, chronic high unemployment, and cradle-to-grave welfare state is unsustainable – Germany cannot single handedly support the profligate spending of other Eurozone nations, even if they had the political will to do so. Unfortunately for us, this sclerotic, slow-growth, expansive welfare state is the model we have now chosen to follow. The outcome will not be different for US.

Nov 15, 2012 9:35am EST  --  Report as abuse
alexaposto wrote:

it would be better to let greece out of the euro , focus on the countries that have a savable economy , greek bureaucracy is a big jock , the people of greece did the damage to greece and it try to blame others for they unsustainable spending .

any one for a ouzo ! let brake the plates OPA OPA la la la

Nov 15, 2012 9:43am EST  --  Report as abuse

Keynesian economic theory is that european governments should borrow money and spend it to spur economic growth.

That’s exactly what Obama did in his last term, and europe has done the same.

Maybe the answer is that europe hasn’t spent enough yet? Maybe if they borrow more and spend it, it will finally work.

It’s worth a shot!

Nov 15, 2012 10:03am EST  --  Report as abuse

The US was in a recession just before WW 2, and the war brought the economy back. Once they became involved in the war, their economy was running on overtime!

Maybe that’s what europe needs now.

Nov 15, 2012 10:09am EST  --  Report as abuse
Quixotic-911 wrote:

Many fools blame austerity for this but if they bothered to look they would see that none of them have done any serious cutting and have at best left spending where it was two or three years ago which isn’t really austere enough to even be called that. The contraction of government and it’s replacement with the private sector may cause short term economic weakness but it is the only real long term solution. To continue as they are will leave everyone with far less than austerity ever threatened to. It looks as though the I want I wants and the gimme gimmes will get there instant gratification, ever penny wise and pound foolish, rather than suffer a cut back they will unwittingly cut themselves off.

Nov 15, 2012 10:23am EST  --  Report as abuse
scythe wrote:

only an economix monkey would wail over graphs that wax and wane

the only entity that grows indefinitely is a tumour

pauses and declines in growth are not only normal, they are necessary

unless you are a debt junkie

Nov 15, 2012 10:24am EST  --  Report as abuse
TJPride wrote:

Of course the lazy, overpaid, and underworked masses are going to complain. The EU just needs to stop listening. If they riot, use tear gas and lock them up. If they decide to commit suicide – well, that’s sad, but nobody forced them to. A much larger number will die in a weak economy.

Nov 15, 2012 10:27am EST  --  Report as abuse
uc8tcme wrote:

I do not know when the EU will get out of their recession, but it will be a very long time well after we firmly get back on our feet. The EU has a structural problem – taking 17 countries and combining them with the only common factor their currency. That would be like the US having 50 different currencies and attempting to combine them on the fly. Each EU country still have there own economic system and beliefs regarding the economy – there lays the breakdown. This is why the US or China can not provide any assistance to them. We all should be helping each other out of this mess – we are having our own issues with China at this time, so every man for themselves. Unfortunately, the EU will have to work this out by their self. The 9 biggest EU countries can not carry the entire zone in this economic climate. I wish them well just the same.

Nov 15, 2012 10:38am EST  --  Report as abuse

You wanted socialism?
You got socialism.
Now…shut up and accept your fate.

Nov 15, 2012 10:39am EST  --  Report as abuse
Jack___Davis wrote:

Second verse, same as the first!!

Nov 15, 2012 10:39am EST  --  Report as abuse
Willie12345 wrote:

Bad debt will do that …………………. will we learn that lesson the hard way ? So it seems.

Nov 15, 2012 10:47am EST  --  Report as abuse
Inhurricane7 wrote:

Don’t look to America to lead, Europe. No new ideas or policy changes over here. We’re just following you. Show us the way.

Nov 15, 2012 10:49am EST  --  Report as abuse
morphysmith wrote:

Europe first then the US led by Obama will follow, into recession.

Nov 15, 2012 11:31am EST  --  Report as abuse
Splitpi wrote:

I am a bit underwhelmed by the writing, “… despite modest growth in Germany and France, data showed on Thursday.

The French and German economies both managed 0.2 percent growth in the July-to-September period…”

0.2% growth over the quarter would mean roughly 0.8% growth over the year. So either that Q slowed dramatically from the previous Q’s or there wasn’t much modest growth to begin with. 0.8% year growth is below inflation and should be considered a depreciation.

In either case, the writing doesn’t match is actually happening.

Nov 15, 2012 11:33am EST  --  Report as abuse
CptObvious wrote:

If you continue the same socialist practices which got you into the first recession, you economic woes will continue. Has everyone on the planet lost the ability to learn?

Nov 15, 2012 11:34am EST  --  Report as abuse
joesetx wrote:

Gee the same big spending socialist policies supported by Democrats here casue a second recession in Europe.

Whit Obama’s re-election this is our future.

Nov 15, 2012 12:33pm EST  --  Report as abuse
USAPragmatist wrote:

Once again a thread full of righties living in their bubbles of unreality not understanding WHY things are the way they are. So far NOT ONE reasonable posting as to what is going, just references to how Socialism is failing, when in fact the current world economic malaise is more related to failures of capitalism without sufficient regulation(the cause of the Financial Crash of 07-08).

Nov 15, 2012 12:57pm EST  --  Report as abuse
uc8tcme wrote:

Thanks USAPragmatist – why can’t we ever have a decent dialogue on these threads. The GOP’ers always go back to how Obama role played into the story – which sometimes the story has nothing to do with him. Most of these folks like the one sided conversation when if you don’t agree with me and the hell with you – this is what Fox News and MSNBC is all about. Let’s get in a blog were everyone can say what is on there mind without being in an attack mode – the election is over.

Nov 15, 2012 1:14pm EST  --  Report as abuse

And they just gave billions to Egypt. Ha

Nov 15, 2012 1:24pm EST  --  Report as abuse
DonDeMarco wrote:

That must be why the US is tanking. WOW, for a second there, I thought Obama would have to go back to the old standy, blame Bush or ATMs.

Nov 15, 2012 2:11pm EST  --  Report as abuse
TheNewWorld wrote:

The US economy is not far behind. Higher taxes alone will send us into a short recession. Add cut federal spending to that and we are looking at a recession that will last much of Obama’s second term. If Republicans play their cards right, they will blame Obama and the Democrats for the economy and take the Senate in 2014 making Obama a complete lame duck. Too that though, they need to give into everything he wants right now, this recession is coming no matter what Obama, the Congress, or the Senate does.

Nov 15, 2012 3:16pm EST  --  Report as abuse
TheNewWorld wrote:

“This is what austerity buys you. Clearly the GOP in the USA haven’t figured that out yet.”

This is what Keynesian economics buys you. You can not spend money that you do not have for decades. This is a debt crisis, it is not an austerity crisis. They aren’t cutting spending because it is a popular policy, THEY ARE CUTTING SPENDING BECAUSE THEY HAVE TO. This is like looking at a crystal ball of the near American future. It is coming America. Next year.

Nov 15, 2012 3:25pm EST  --  Report as abuse
TheNewWorld wrote:


The Eurozone recession is happening because of their unsustainable deficit spending. It is called a debt crisis, not a bank crisis. The banks stabilized in 2009. It did start recession in 2008, but this is caused completely because the governments are doing the same things that you hate about the banks. I will never understand why running a countrie’s budget into the ground is acceptable to Keynesians.

The US and Europe has been playing with our monetary system for decades. Interest rates have been kept too low, for too long. We have fought off this recession for as long as possible for political gain. The recession is the economy correcting itself from the government created bubble of artificial spending. You can not artificially grow the economy forever. When you run out of money, the economy goes back to where it always was. This isn’t capitalism. The government has their fingerprints all over the current mess.

Nov 15, 2012 3:42pm EST  --  Report as abuse
USAPragmatist wrote:

@TheNewWorld, Like I have alluded to before it is hard ot have rational discussions with people who really believe things like ‘The recession is the economy correcting itself from the government created bubble of artificial spending.’ What caused the financial crash was many institutions on Wall Street decided to market bundled mortgages derivatives as ‘AAA’ when they knew they where not. This caused an artificial demand in the housing market, running up prices and creating the housing price bubble. When this bubble popped the whole house of financial cards based upon it cam tumbling down. With proper oversight this should have never happened.

Of course this is the simplified explanation, to fully describe it would require a book. And many smart, nonpartisan economists have done this. You should perhaps do a little research and find one to educate yourself. That is of course assuming you have an open mind about the situation.

Nov 15, 2012 4:36pm EST  --  Report as abuse
TheNewWorld wrote:


This isn’t a rational discussion because you are talking about two completely different things. You should stick to science, you are lost when it comes to economics. We aren’t talking about the financial collapse in 2007-2008 here. We are talking about the Debt crisis in Europe. The debt was piled up by excessive government spending, that artificially stimulated the economy. The removal of this spending (austerity) is causing a recession, if you disagree, you are wrong.

Here is a crash course in the danger of budget deficits and debt for you. In the US, the 2012 budgeted total direct revenue is $2.5 trillion. We spend an extra $1.1 trillion than we make, over $400 billion of that goes to interest payments. 16% of revenue goes to interest. Okay, that could be manageable if we weren’t continuing to pile on that debt number at a reckless rate. The deeper we go in debt, the less money we have to spend on everything else due to interest payments. You can not cut spending on interest. If you miss your interest payments, you lose all ability to further borrow money, your credit rating gets dropped significantly, and best of all, you get higher interest rates on your debt and your interest payments increase. If you blow it off altogether, your currency collapses because it is based on public faith in the government (not anything of value like say gold), which is now ruined. This is the recipe for a Great Depression. With the American dollar being the world wide currency, you are looking at a Worldwide, Great Depression. Tons of fun. You can ignore macroeconomics and the laws of finance all you want. It does not change the reality of debt, deficits, and fiat economies.

Nov 15, 2012 10:59pm EST  --  Report as abuse

In a free economy, the depression would end. The fact that the depression continues, shows we are not in a free economy.

Nov 16, 2012 7:13am EST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.