Breakingviews: Another year of the Great Stagnation
Tuesday, April 02, 2013 - 03:55
April 2 - 2013 looks like yet another year of tepid growth around the world. Welcome to another year of the Great Stagnation says Breakingviews.
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Welcome to another year of the great stagnation. Is the title of Edward passes breaking news piece today joins in the studio I mean it sounds pretty bleak -- Maybe maybe a little too good. Well depends who you're looking for. Growth growth through her growth and its -- If you're looking for lower unemployment. It's not great either and so yeah it's pretty bleak. I mean we'll take a look at the data we just had a bunch of data from Japan from the years and -- the US and pretty much all of it was disappointing mention Japan it is spun by -- among others is being not too bad but. Instead of capital spending increasing -- going to be decreasing this year. And sentiment remains firmly negative in Japan. US manufacturer sentiment is supposed to be increasing was disappointing it's a little bit above positive. People parking lots of frustration and so forth but. What we see is again the fifth year of -- kind of poor economic you don't you don't take getting -- from from from some of the strengths were saying in particular the US or are you still. -- glass half empty. -- and when you look at the physical well in the US -- -- glass. -- 40% -- that whereas in Europe it's more like a 55% empty glass in Japan probably 60%. On the US recovery has been a little bit better in the European but remember. US has much more favorable demographics it's working age population still increasing whereas it's decreasing in Europe's do you expect. Even stagnation. To have a slightly better outcome in terms of national statistics from the US. Compared to where we were before the decline. It doesn't look very impressive at all interest sting from that that the three words you use at the end stifling growth. Com debts. Solid enough. Demographics sorted and -- I like I like if yeah because is little little psychological. And how how do you measure that you can't measure it you you only make treated directly bit. One of the reasons we will establish principles of economics is that confidence plays an important role in economic growth. -- companies want to invest individuals won't -- firms. Unless they feel that the areas -- supporting economic environment. They don't feel that right now in the Euro zone -- nothing but dire headlines all over the developed world you very high debts you government balances that are out of whack. US Central Bank monetary policy it's supposed to be stimulative. And probably is in some sense but it also makes people afraid that things could go worse later when you speak to colleagues and friends in the US do you -- are awesome because I'm getting this from from a lot of ex colleagues and and and friends. You get a sense. From them wait glad -- he looking out that that but ladies that is so out of context in which your list. Americans are forever explaining how life is better there relative to you're -- -- a little bit of a point. The it's -- mean unemployment rate has -- another job creation. You adjust for his statistics piece that's going to be writing later this week. If you just for the changing demographics the job creation statistics in the US don't look particularly impressive relative to Europe. And if you adjust for population again the output doesn't look particularly impressive relative to Europe so. I -- I'm sure Americans are happy to be in America and bless them all but actually from an economic perspective. It's not. Necessarily obvious that they've had a much better run than the Europeans. OK Edward we afford to prison you know which many thanks Edward had us from breaking views. I don't watch our US show that comes out everyday talk Freddie students at Easton seventy infested BST I'm -- problem this is --
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