And what does this have to do with NY residential real estate? http://www.nytimes.com/2011/02/23/business/economy/23leonhardt.html?hp emember the German economic boom of 2010? Germany’s economic growth surged in the middle of last year, causing commentators both there and here to proclaim that American stimulus had failed and German austerity had worked. Germany’s announced budget cuts, the... [more]
And what does this have to do with NY residential real estate?
http://www.nytimes.com/2011/02/23/business/economy/23leonhardt.html?hp
emember the German economic boom of 2010?
Germany’s economic growth surged in the middle of last year, causing commentators both there and here to proclaim that American stimulus had failed and German austerity had worked. Germany’s announced budget cuts, the commentators said, had given private companies enough confidence in the government to begin spending their own money again.
Well, it turns out the German boom didn’t last long. With its modest stimulus winding down, Germany’s growth slowed sharply late last year, and its economic output still has not recovered to its prerecession peak. Output in the United States — where the stimulus program has been bigger and longer lasting — has recovered. This country would now need to suffer through a double-dip recession for its gross domestic product to be in the same condition as Germany’s.
Yet many members of Congress continue to insist that budget cuts are the path to prosperity. The only question in Washington seems to be how deeply to cut federal spending this year.
[ ... ]
The fundamental problem after a financial crisis is that businesses and households stop spending money, and they remain skittish for years afterward. Consider that new-vehicle sales, which peaked at 17 million in 2005, recovered to only 12 million last year. Single-family home sales, which peaked at 7.5 million in 2005, continued falling last year, to 4.6 million. No wonder so many businesses are uncertain about the future.
Without the government spending of the last two years — including tax cuts — the economy would be in vastly worse shape. Likewise, if the federal government begins laying off tens of thousands of workers now, the economy will clearly suffer.
That’s the historical lesson of postcrisis austerity movements. The history is a rich one, too, because people understandably react to a bubble’s excesses by calling for the reverse. When Franklin Roosevelt was running for president in 1932, he repeatedly called for a balanced budget.
But no matter how morally satisfying austerity may be, it’s the wrong answer. Hoover’s austere instincts worsened the Depression. Roosevelt’s postelection reversal helped, but he also prolonged the Depression by raising taxes and cutting spending in 1937. Only the giant stimulus program known as World War II finally ended the Depression. When the private sector is hesitant to spend, the government has to — or no one will.
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Response by MidtownerEast
about 15 years ago
Posts: 733
Member since: Oct 2010
Clearly you don't read the news. The recession is over because people are buying luxury items like lattes and lacy bras:
LONDON (MarketWatch) — The economy of the 16-nation euro zone grew less than forecast in the fourth quarter of 2010, data showed Tuesday, as sharp differences in performance again emerged between powerhouse Germany and debt-laden peripheral nations such as Greece.
Euro-zone gross domestic product rose 0.3% in the fourth quarter from the previous three months, according to Eurostat, the European Union’s statistics agency.
The increase was below the consensus forecast of 0.4% growth. GDP had expanded by 0.3% in the third quarter.
Compared with the fourth quarter of 2009, euro-zone GDP rose 2%.
“In a climate of strong global demand and very low interest rates, the region should in fact be achieving far stronger growth,” wrote Commerzbank analyst Christoph Weil in a note to clients.
German growth slows
Separately, it was reported that the German economy — Europe’s biggest — rose 0.4% in the final quarter of 2010 from the preceding three months. However, analysts polled by Dow Jones Newswires had been looking for a 0.5% increase.
The figures “showed that the economy has lost somewhat more steam than expected,” said Carsten Brzeski, senior economist at ING Belgium, in a research brief.
“The strong snowfall in December spoiled the German party, probably preventing an even better growth performance,” he wrote. “Nevertheless, looking ahead, the German economy should return to above-trend speed.”
Confirming expectations for a positive outlook, the German ZEW indicator of economic sentiment rose marginally in February, reaching 15.7 points from 15.4.
“The almost unaltered level of the indicator suggests that financial market experts have remained confident about the recovery of the German economy,” said the Centre for European Economic Research, or ZEW.
The German economy grew by 3.6% last year after contracting sharply during 2009.
“There is still a large gap between individual countries,” Commerzbank’s Weil said. “The fringe states, suffering the effects of the property bubble bursting and huge government deficits, are struggling to get back on their feet. In contrast the ‘healthy’ countries, with Germany at the head, are still emerging rapidly from the past crisis.”
Debt-laden Greece and Portugal put in particularly dismal performances, data showed. . . .
French growth disappoints
For its part, France’s GDP rose by 0.3% in the fourth quarter after 0.3% growth in the previous three months.
The performance was below analyst forecasts for 0.6% growth, however.
Chris Williamson, chief economist at Markit, said French fourth-quarter growth was “disappointingly mediocre.”
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Response by MidtownerEast
about 15 years ago
Posts: 733
Member since: Oct 2010
See, Alan, it was the snowfall in Germany that accounted for the slowdown. Just like the increase in cream cheese prices will spark inflation here.
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Response by huntersburg
about 15 years ago
Posts: 11329
Member since: Nov 2010
I think most people stopped thinking that the cream cheese jokes were funny by Sunday.
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Response by alanhart
about 15 years ago
Posts: 12397
Member since: Feb 2007
MidtownerEast, you are such a gullible fool.
The alleged "snowfall" in Germany? Actually cream cheese!
Clearly you don't read the news. The recession is over because people are buying luxury items like lattes and lacy bras:
http://today.msnbc.msn.com/id/40547323/ns/business-consumer_news/
(I always thought those two went together.) If the cream cheese market holds, we are at complete recovery.
lattes, lacy bras, cream cheese.
And still waiting for that marriage "someday"
alan, keep begging for handouts. You have more experience with that than with economics:
http://www.marketwatch.com/story/german-economic-growth-slows-in-fourth-quarter-2011-02-15
LONDON (MarketWatch) — The economy of the 16-nation euro zone grew less than forecast in the fourth quarter of 2010, data showed Tuesday, as sharp differences in performance again emerged between powerhouse Germany and debt-laden peripheral nations such as Greece.
Euro-zone gross domestic product rose 0.3% in the fourth quarter from the previous three months, according to Eurostat, the European Union’s statistics agency.
The increase was below the consensus forecast of 0.4% growth. GDP had expanded by 0.3% in the third quarter.
Compared with the fourth quarter of 2009, euro-zone GDP rose 2%.
“In a climate of strong global demand and very low interest rates, the region should in fact be achieving far stronger growth,” wrote Commerzbank analyst Christoph Weil in a note to clients.
German growth slows
Separately, it was reported that the German economy — Europe’s biggest — rose 0.4% in the final quarter of 2010 from the preceding three months. However, analysts polled by Dow Jones Newswires had been looking for a 0.5% increase.
The figures “showed that the economy has lost somewhat more steam than expected,” said Carsten Brzeski, senior economist at ING Belgium, in a research brief.
“The strong snowfall in December spoiled the German party, probably preventing an even better growth performance,” he wrote. “Nevertheless, looking ahead, the German economy should return to above-trend speed.”
Confirming expectations for a positive outlook, the German ZEW indicator of economic sentiment rose marginally in February, reaching 15.7 points from 15.4.
“The almost unaltered level of the indicator suggests that financial market experts have remained confident about the recovery of the German economy,” said the Centre for European Economic Research, or ZEW.
The German economy grew by 3.6% last year after contracting sharply during 2009.
“There is still a large gap between individual countries,” Commerzbank’s Weil said. “The fringe states, suffering the effects of the property bubble bursting and huge government deficits, are struggling to get back on their feet. In contrast the ‘healthy’ countries, with Germany at the head, are still emerging rapidly from the past crisis.”
Debt-laden Greece and Portugal put in particularly dismal performances, data showed. . . .
French growth disappoints
For its part, France’s GDP rose by 0.3% in the fourth quarter after 0.3% growth in the previous three months.
The performance was below analyst forecasts for 0.6% growth, however.
Chris Williamson, chief economist at Markit, said French fourth-quarter growth was “disappointingly mediocre.”
See, Alan, it was the snowfall in Germany that accounted for the slowdown. Just like the increase in cream cheese prices will spark inflation here.
I think most people stopped thinking that the cream cheese jokes were funny by Sunday.
MidtownerEast, you are such a gullible fool.
The alleged "snowfall" in Germany? Actually cream cheese!
Alan, you can do better.