UK - Eurozone Crisis Live

[hello_10]

Eurozone unemployment at fresh high

Unemployment in the eurozone hit a fresh high of 18.2 million in August, the EU statistics agency has said.

The number out of work rose by 34,000, but after the July data was revised up, it meant the unemployment rate remained stable at a record high of 11.4%.

The highest unemployment rate was recorded in Spain, where 25.1% of the workforce is out of a job, and the lowest of 4.5% was recorded in Austria.

The unemployment rate in Germany was 5.5%, Eurostat said.

'Lost generation'

Last week, the European Commission warned of the existence of "a real social emergency crisis" due to the fall in household income and growing household poverty.

Youth unemployment remains a particular concern, with the rate among under-25s hitting 22.8% across the eurozone, and 52.9% in Spain.

The commission repeated its call to governments and businesses to act to try to avoid the "disaster" of "a lost generation".

In Greece, the most recent figures recorded in June show that more than 50% of the young workforce has no job.

These two countries have by far the highest unemployment rate in the eurozone, as both governments look to cut spending and raise taxes to try and cut high debt levels.

These actions, which are needed in Greece to meet the terms of two huge bailouts and in Spain to restore confidence among international investors in Madrid's ability to repay its debts, have exacerbated the unemployment problem.

The eurozone as a whole is also struggling to generate the economic growth needed to stimulate employment. Its economy shrank by 0.2% between April and June, with Italy and Spain stuck in recession and France registering no growth for the past three quarters.

The notable exception is the German economy, Europe's biggest, which grew by 0.3% in the second quarter.

Across the wider 27-nation European Union, unemployment rose by 49,000 to 25.5 million people, Eurostat said, with the unemployment rate stable at 10.5%.

A commission spokesman said the total was "clearly unacceptable".

Compared with a year earlier, the unemployment rate rose in 20 countries, fell in six and remained stable in the UK.

By way of comparison, the unemployment rate in the US was 8.1% in August and 4.1% in Japan.

Child poverty fears

The European Commission said last week that disparities between the best and worst performing economies had continued to widen in the second quarter of the year.

It also expressed concern about the social situation, which remained "very serious".

The number of people experiencing financial stress remains historically high, it said in its latest quarterly review of the jobs situation across the European Union.

Household incomes had declined dramatically in Greece, where disposable incomes had dropped by 15.7% between 2009 and 2011, the commission said. Households in Ireland were living on 9% less.

Child poverty was also becoming an issue for an increasing number of households, particularly in countries where child benefits are inadequate.

Almost a fifth of families are at risk of poverty in Spain, Greece, Italy and Portugal, the review said.

BBC News - Eurozone unemployment at fresh high

GLOBAL ECONOMY-China on mend, but euro zone still shrinking
Dec 14, 2012

Eurozone Composite PMI below 50 but at 9-month high

* Chinese manufacturing expands at fastest pace in 13-months

* U.S. data expected to show continued growth

By Jonathan Cable and Lucy Hornby

LONDON/BEIJING, Dec 14 (Reuters) - China's vast manufacturing sector expanded in December but the euro zone is probably deeper in recession, business surveys suggested on Friday.

Data researcher Markit said its Eurozone Flash Composite Purchasing Managers Index, which combines both manufacturing and services sector data, showed small signs of improvement.

It rose to a nine-month high of 47.3 this month, beating forecasts for 46.8.

But this remains below the 50 mark that signifies contraction and Markit said the PMI data for the fourth quarter is consistent with a decline in overall growth of 0.5 percent.

China's data, however, may signal that the global economy is on the mend.

"The improved conditions on financial markets and the pick-up in global growth momentum, as signaled by the further pickup in the Chinese PMI, should steady the pace of decline from here on," said Martin van Vliet at ING.

China's manufacturing sector expanded in December at its fastest pace in 14 months as new orders and employment rose, adding to evidence of a pick up in the economy that helped to boost market sentiment.

"The renewed rise in the headline PMI is a further sign that the Chinese economy is already starting to recover," said Nikolaus Keis at UniCredit.

The HSBC flash PMI for December rose to 50.9, the highest level since October 2011 and the fifth straight monthly gain. A figure above 50 indicates that growth is accelerating, while one below 50 shows slowing growth.

Data due at 1358 GMT is expected to show manufacturing activity also expanded again this month in the United States, albeit at a slightly weaker pace than in November.

RAY OF LIGHT

The euro zone economy contracted 0.2 percent in the second quarter and 0.1 percent in the third, meeting the technical definition of a recession and a Reuters poll last week predicted a 0.3 percent contraction in the current period.

That would be slightly better than the PMIs suggest.

Earlier, composite PMI data from Germany, Europe's largest economy, showed its private sector bounced back to growth for the first time in eight months in December.

In neighbouring France, however, while the downturn eased the PMI held below 50 for the 10th straight month.

The regional PMI has been below the 50 mark for all but one of the past 16 months but the euro zone agreed a deal on Thursday to provide nearly 50 billion euros in long-delayed aid to Athens.

It averts a catastrophic default and secures Greece's survival in the euro zone after months of doubt and political turmoil. Athens had repeatedly missed fiscal targets agreed with the EU and the International Monetary Fund, and stalled structural economic reforms.

The PMI for the euro zone's dominant service sector rose to 47.8 this month from 46.7, beating forecasts for a rise to 47.0.

The continued downturn came despite firms cutting prices despite their costs rising - cutting into their margins - for the ninth month.

Official data showed inflation in the bloc eased to 2.2 percent in November, potentially giving the European Central Bank room to ease policy further and support growth.

Manufacturers, who led the bloc out of the last recession, fared little better. The factory PMI crept up to 46.3 from 46.2, missing forecasts for a steeper rise to 46.6.

But in a further sign the global economy might be improving, the rate of decline in new export orders from factories eased, with the sub-index at a nine-month high of 46.8.

"There are some rays of hope here. It is moving in the right direction so there are signs that the business cycle has reached a low point globally and is picking up," Chris Williamson, chief economist at Markit said.

GLOBAL ECONOMY-China on mend, but euro zone still shrinking | Reuters

 

[satish007]

Time to become pirate again. but this time, they have to deal with strong Indian and Chinese Navy.

 

[hello_10]

Time to become pirate again. but this time, they have to deal with strong Indian and Chinese Navy.

sir, along with all these recent news, a long time before I had said that "West is now finish", due to my personal experience with the western politicians. i told to them, "its very less likely that those who are really well being, organize this type of cheap class acts. those who have enough wealth, with security of future too, dont really behave in the way things happened for so long....." since the things i saw since 2008, i referred it as, "Bujhate Diye Ki Dhadhak.", means, when a light is about to be off, it produce bit more light at the end

and the ground realty is, not only EU with the news in this thread, but have a look on US too as being discussed in the thread as below, they are simply moving towards no return. a very dark future they have smelled, along with the current crisis, and they all are trying to get something done in unity, before they may face their imminent worse. and all these new wars every year is part of their combined efforts to get something done before the world may get completely changed :shocked:

http://defenceforumindia.com/forum/americas/44014-rise-neo-nazi-groups-usa-5.html

 

[sesha_maruthi27]

2012=2013 will bring an end to the western harassment and western domination on the world...........

 

[hello_10]

Almost 90% would 'consider moving abroad' for better financial prospects

Nearly nine in 10 Britons would consider leaving the UK for a better - and wealthier - life abroad within the next five years

The current recession combined with the perception that property is cheaper overseas and job prospects better collectively accounted for nearly a third of all reasons for emigrating, according to a survey by Skyscanner.

Sam Baldwin, Skyscanner's travel editor, said: "For many people the idea of 'living the dream' abroad is very alluring. The survey revealed that our perception of life abroad is very positive – perhaps overly so – and many people come back from a holiday enamoured with their destination. Interestingly, Spain and USA were two of the most popular places even though both countries are currently suffering from their own economic problems, which suggests that the dream of moving abroad to improve financial prospects may be just that - a dream.

The dream may be more realistic if, rather than moving abroad to look for new work, you are sent abroad as part of an existing job. Around 750,000 British workers are being posted abroad on assignments with their existing employer, and a massive 84 per cent believe this is helping them to climb the corporate ladder, according to the NatWest International Personal Banking (IPB) Quality of Life Index.

They also feel they benefit from an improved lifestyle, backing up the Skyscanner research results, and the increasing use of temporary global workers means that the traditional definition of 'expat' is now being blurred, said Dave Isley, head of NatWest International Personal Banking.

He added: "The growth of the global worker has brought with it an opportunity to share knowledge and experience around the world. The great brain exchange is a fantastic concept of other economies temporarily sharing the strengths of British workers.

Almost 90% would 'consider moving abroad' for better financial prospects - Telegraph

Five million paid less than living wage
29 October 2012

One in five workers in the UK is paid less than required for a basic standard of living, a report has said.

The proportion is much higher among waiters and bar staff, at up to 90% of workers, the research for accountants KPMG suggested.

It said that nearly five million people failed to command the living wage - a pay packet that enabled a basic standard of living.

The rate stands at £8.30 an hour in London and £7.20 in the rest of the UK.

This rate is voluntary, unlike the National Minimum Wage - the amount that employers must pay by law, which is set at £6.19 an hour for those aged 21 and over.

"Times are difficult for many people, but of course those on the lowest pay are suffering the most," said Marianne Fallon, head of corporate affairs at KPMG, which has itself signed up to pay the living wage.

"Paying a living wage makes a huge difference to the individuals and their families and yet does not actually cost an employer much more.

"Tackling in-work poverty is also vital if we are to enable more people to improve their life prospects and increase social mobility in this country."

BBC News - Five million paid less than living wage, says KPMG

 

[hello_10]

Deficit, national debt and government borrowing: UK

Britain's deficit is getting worse. The government borrowed more than expected in November, Office for National Statistics data shows, reducing the chance that the government will meet its 2012/13 deficit reduction goal.

Josephine Moulds writes today:

Separate figures from the ONS show the government borrowed more than expected in November, as spending rose but tax receipts fell from a year earlier.

Howard Archer of IHS Global Insight said: "The disappointing November public finance data fuel mounting expectations that at least one of the credit rating agencies will strip the UK of its triple A rating in 2013." Archer also said it "looks touch and go" as to whether the economy can avoid renewed contraction in the fourth quarter.

The ONS says the government's preferred measure, public sector net borrowing excluding financial sector interventions, came in at £17.5bn in November, up from £16.3bn in November 2011.

We have the complete set of data on Government borrowing, all the way back to the 1940s. All political parties have faced their fair share of debt through the years - almost as if the economic climate has its own life independent of who is managing it.

What is the deficit? When the ONS talks about the deficit, they take a simple measure - the gap between what's coming into the government in taxes and receipts versus what's being spent. Most commentators look at net borrowing as the deficit figure, because it includes investment spending. It's different to the national debt - which is the total the country owes.

So last month the budget was in deficit. Here are the key facts for November - if you exclude the temporary effects of the financial interventions in the banks:

"¢ Public sector net borrowing was £17.5bn in November 2012; this is £1.2bn higher net borrowing than in November 2011, when net borrowing was £16.3bn
"¢ Public sector current budget deficit was £15.8bn in November 2012; this is a £1bn higher deficit than in November 2011, when there was a deficit of £14.8bn
"¢ April to November 2012, public sector net borrowing (excluding the capital payment recorded as part of the Royal Mail Pension Plan transfer in April 2012) was £92.7bn; this is £8.3bn higher net borrowing than in the same period the previous year, when net borrowing was £84.4bn
"¢ In 2011/12, public sector net borrowing was £121.6bn; this is £4.4bn lower than the Office for Budget Responsibility (OBR) forecasted net borrowing for 2011/12 of £126.0bn
"¢ Public sector net debt was £1083.6bn at the end of November 2012, equivalent to 68.5% of gross domestic product (GDP)

The ONS data below shows monthly, quarterly and annual debt and deficit - what can you do with it?

Deficit, national debt and government borrowing - how has it changed since 1946? | News | guardian.co.uk

Budget deficit worsens, credit rating at risk

Budget deficit worsens, credit rating at risk | Reuters

 

[hello_10]

Argentina opens doors to migrants, but settling elsewhere is harder

As growing numbers of Europeans leave the continent and its economic woes, how easy is it to go and live in a new country?

Ipanema beach in Rio de Janeiro. Some European immigrants work in Brazil illegally by repeatedly renewing 90-day tourist visas.

Argentina opens doors to migrants, but settling elsewhere is harder | World news | guardian.co.uk

Eurozone debt hits 90% of economy
October 24, 2012

LONDON — In spite of years of harsh spending cuts and tax increases, Europe's debt problems are getting worse.

The European Union's statistics office, Eurostat, reported Wednesday that, at the end of the second quarter, the total government debt of the 17 countries that use the euro was worth 90 percent of the group's total economic output for the year. That is the highest level since the euro was launched in 1999.

The rise from the previous quarter's debt-to-GDP ratio of 88.2 percent, and the previous year's equivalent of 87.1 percent, is a result of the eurozone's economic problems – which are making it harder for countries to handle their debts.

"The euro-area economy remains stuck in a rut," said James Ashley, senior European economist at RBC Capital Markets.

According to Eurostat, five of the countries that use the euro are in recession – Greece, Spain, Italy, Portugal and Cyprus.

Many analysts expect the eurozone to slip back into recession in the third quarter of the year, when official figures are published next month. A recession is technically defined as two quarters of negative growth in a row.

Other figures Wednesday pointed to a deepening economic crisis in the eurozone.

The purchasing managers' index – a gauge of business activity – from financial information company Markit fell from the previous month's 46.1 to 45.8 in October – its lowest level in more than three years. Any figure below 50 indicates a contraction in activity.

Meanwhile, a closely watched survey from the economic research group Ifo Institute found that business confidence in Germany, Europe's biggest economy, dropped for the sixth month in a row, confounding expectations of a modest increase.

Ifo's key figure for October dropped to 100, from 101.4 in September.

Germany has been the main reason why the eurozone has not fallen into recession.

The country's powerhouse exporters, such as Volkswagen and BMW, have taken a slice of rising trade volumes around the world while its consumers have shown an increasing appetite to spend.

But Germany's economy recently has lost its momentum as the debt troubles on its doorstep have weighed on economic confidence.

A shrinking economy makes the value of a country's debt as a proportion of the size of its economy worse.

For example, Italy's debt burden has risen from 123.7 percent in the first quarter to 126.1 percent in the second quarter, while its economy has shrunk for four straight quarters.

Greece's finances, though, are in a league of their own.

The country, which is struggling to convince debt inspectors that it's fulfilling pledges it has made in return for billions of dollars worth of bailout cash, saw the biggest quarterly increase in its debt burden, to 150.3 percent of national income, in the second quarter from 136.9 percent in the first.

The increase comes despite a dramatic fall in debt in the first quarter after Greece had negotiated a deal with private bondholders to accept a write-down of their Greek holdings. The country's debt was reduced to $364 billion in the first quarter from $443 billion in the second quarter of 2011 as a result of the write-down.

But any advantage gained is slowly being whittled away by the country's deep recession, which appears headed for a sixth year.

Interest on the debt, as well as continued budget deficits, pushed the debt back above $390 billion in the second quarter of 2012.

Eurozone debt hits 90% of economy - Washington Times

Because of the failure to balance a single budget since 1981, public debt has risen from 22% of GDP then to over 90% now.

Debt crisis: as it happened, November 16, 2012 - Telegraph

 

[hello_10]

Euro zone factory downturn deepens in December: PMI
2 JAN, 2013

LONDON: The slowdown in euro zone factory activity deepened in December as new orders tumbled, a business survey showed on Wednesday, suggesting the economy may have slipped further into recession in the last quarter of 2012.

Manufacturers helped lift the 17-nation bloc out of the last recession, but purchasing managers' surveys showed Ireland was the only member of the currency union to register growth in December as the malaise sank its roots further into the bloc's core economies.

"The euro zone manufacturing sector remained entrenched in a steep downturn at the end of the year. The region's recession therefore looks likely to have deepened, possibly quite significantly, in the final quarter," said Chris Williamson, chief economist at Markit.

Markit's Eurozone Manufacturing Purchasing Managers' Index (PMI) edged down to 46.1 in December from November's 46.2. The final December figure was down from an earlier reported flash reading of 46.3. The index has been below the 50 mark that divides growth from contraction since August 2011.

The output index fell to 46.0 from November's 46.1 and as the decline continued, factories cut their workforces at a faster pace than in the previous month.

Germany, Europe's largest economy, saw its manufacturing sector shrink for the 10th straight month and at a faster pace than in November, while French data showed a decline in all but one of the past 17 months, surveys showed earlier.

The slump in Spain deepened last month, while Italy's index remained below 50 for the 17th month.

DIMINISHING DEMAND

The euro zone fell into its second recession since 2009 last year and its economy likely contracted again in the fourth quarter, according a Reuters poll, and is only seen returning to growth in the second quarter this year.

"Manufacturers look to be in for another tough year in 2013, though prospects have brightened a little, as producers should benefit from signs of stronger demand in key export markets such as the United States and China," Williamson said.

New orders, a gauge of future output, fell for the 19th month, with the subindex sinking to 43.5 from 44.2 and considerably lower than the earlier flash reading of 44.1 although the rate of decline in exports eased from the previous month.

Annual growth in China's industrial profits quickened to 22.8 per cent in November from October's 20.5 per cent, official data showed last week, reinforcing signs of a steady economic recovery thanks to pro-growth policies.

However, while the US economy will remain sluggish in 2013, underscoring a very fragile world economic outlook, it will outperform its European peers.

Euro zone factory downturn deepens in December: PMI - The Economic Times

 

[hello_10]

Eurozone unemployment reaches new high
8 January 2013

The unemployment rate across the eurozone hit a new all-time high of 11.8% in November, official figures have shown.

This is a slight rise on 11.7% for the 17-nation region in October. The rate for the European Union as a whole in November was unchanged at 10.7%.

Spain, which is mired in deep recession, again recorded the highest unemployment rate, coming in at 26.6%.

More than 26 million people are now unemployed across the EU.

For the eurozone, the number of people without work reached 18.8 million said Eurostat, the official European statistics agency said.

'Continuing saga'

Greece had the second-highest unemployment rate in November, at 20%.

The youth unemployment rate was 24.4% in the eurozone, and 23.7% in the wider European Union. Youth unemployment - among people under 25 - was highest in Greece (57.6%), followed by Spain (56.5%).

Overall unemployment was lowest in Austria (4.5%), Luxembourg (5.1%) and Germany (5.4%).

The eurozone and wider European Union economies are struggling with recession as government measures to reduce sovereign debt levels have impacted on economic growth.

However, European Commission President Jose Manuel Barroso said on Monday that he believed the worst was over.

Mr Barroso said the turning point was last September's promise from the European Central Bank to buy unlimited amounts of eurozone states' debts, which has helped crisis hit countries borrow more cheaply.

But in the view of the UK's Institute of Directors, whose members rely on demand from trading partners in the eurozone, this "has bought time, but that is all it has done".

"It is clear that the economic implosion of several member states continues at a troubling pace," said the business group's chief economist Graeme Leach.

"The headline figures spell bad news, but that is compounded by the political and human impact of terrifying levels of youth unemployment in Spain, Greece and Italy.

"This saga is far from over, whatever President Barroso may believe, and it seems it is set to get worse in 2013."

'Very shocking'

BBC Economics Correspondent Andrew Walker said: "The biggest rises, in percentage terms, were in countries at the centre of the eurozone financial crisis - Greece, Spain, Cyprus and Portugal. One striking exception to that pattern was the Republic of Ireland where unemployment fell.

"The general trend however remains upwards and it makes it even harder for the governments concerned to collect the taxes they need to stabilise their debts."

Rabobank economist Jan Foley said the rise in unemployment was "the other side of austerity or structural reform."

"There is a very worrying picture painted by these numbers, and governments do need to wonder if they need more pro-growth strategies in the next few years," she told the BBC's News Channel.

The record low for the eurozone unemployment rate was 7.2%, which was recorded in February 2008, before the financial crisis that first gripped the banking sector spread to the real economy.

The historic low for the eurozone youth unemployment rate was 15% in March 2008.

BBC News - Eurozone unemployment reaches new high

 

[hello_10]

Income inequality growing faster in UK than any other rich country

Top 10% have incomes 12 times greater than bottom 10%, up from eight times greater in 1985, thinktank's study reveals

Income inequality growing faster in UK than any other rich country, says OECD | Society | The Guardian

Indians account for 22% of Britain's ultra-rich club
Indians account for 22% of Britain

Super-rich Indians account for more than 20% of the wealth of ultra-high net worth (UHNW) individuals in Britain, a new list showed on Tuesday. As a national group, they are second only to expat Russians.

The list, published by the Singapore-based Wealth-X group, places steel magnate and ArcelorMittal chairman Lakshmi Mittal at second place with a fortune of $15.8 billion. Mittal was pushed to the second spot this year by Russian Alisher Burkhanovich Usmanov, who is part owner of the English football club Arsenal and is worth $16.4 billion.

Indians account for 22% of Britain

UK recession "now bites high earners"
14 September 2012

A third of higher earners have switched to cheaper supermarkets and dipped into savings to make ends meet, according to a report.

Almost one in seven across all groups cannot see a time when their income will cover their outgoings, rising to one in five among the most "stretched", found the bi-annual Axa Big Money Index.

Consumers have remained pessimistic about their situation in the six months to June and just 16% believe their financial situation will improve in the long term.

The "widespread pessimism" sees 28% cutting back on food spending and almost one in four forced to spend less on gas, oil and electricity. Even wealthier groups of people continue to switch to using cheaper supermarkets for basic food shopping.

Recession 'now biting high earners' - UK, Local & National - Belfasttelegraph.co.uk

 

[hello_10]

Poverty returns to Europe by leaps and bounds

The news about the economic situation in the EU reminds frontline reports. Head of Unilever in Western Europe, Ian Zeyderveld, from the pages of the Financial Times Deutschland said that poverty is returning to Europe. The main reason for the increasingly lower income of the residents of the Old World is a full-blown crisis in the euro area that is still far from complete.

Ian Zeyderveld has proposed a new strategy to remedy the rapidly declining profits of Unilever in Western Europe. He believes that product packaging should be made smaller to reduce its price. It works both in Asia and now in Europe. The Unilever is not alone in changing its marketing strategy in the crisis-stricken European countries.

Head of the Department on International Financial Issues at the Centre for European Economic Research, Professor Michael Schroeder said that the European crisis affects export-oriented producers more than others. As a result, market conditions weaken, unemployment rises, and living standards lower. According to the expert, this situation may last for three to four years. Numerous examples of the fall of the level of European citizens clearly illustrate his words.

In its study, the British Guardian newspaper found that 83 percent of teachers in the UK every day see hungry students. Over half of teachers say that in the last couple of years the number of hungry school children has increased, as many British families are suffering from reduced benefits, unemployment and recession. Almost half of the teachers admitted to feeding starving scholars, one in five even gives them money for lunch. Why is this happening?

The Center of the Modern Family in the UK conducted a study that demonstrated the effects of the fall of wages and cost of living for the Britons, and increased cost of goods and services related to child care. The crisis also hurts young Britons of 18-32 years old – according to the survey, one in five cannot pay their utility bills, and one in eight young resident of England skips lunch for the opportunity to feed their family.

But Britain is not the poorest country in Western Europe. The situation in not so wealthy economies of the region is much worse. The unemployment rate for people aged 16 to 24 years old in Italy is 28 percent, in Greece – 43 percent, and in Spain – 51 percent.

The Greek economy in the past year fell by 6 percent, the recession in the country has been ongoing for five years, and it is projected that this year the economy will fall by another 5 percent. About 20 percent of retail stores were shut down. The number of suicides in Greece over the last 12 months has increased by 40 percent, and the amount of debt of the Greek government, according to the IMF, is 160 percent of GDP.

In June of this year, the public debt of Italy, according to the local central bank, has reached a record $2 trillion euros, which is 123 percent of its GDP. Italian Prime Minister Mario Monti said that Italy does not need financial help from the EU, but only moral support, which is hard to believe.

The second largest economy in Europe after Germany, France, has also suffered from the crisis. According to the Statistics Bureau of France Insee, this is the third stagnant quarter in a row. Stagnation is, of course, not a recession, but the country's government has a lot to think about.

Perhaps one of a few countries that are more or less stable during the financial storms is Germany. According to the National Bureau of Statistics, the growth of the economy of Germany for the year 2012 was 0.5 percent. It had a positive impact on the growth of domestic consumption and export.

The opinion of the Europeans about the situation is worthy of note. In July of 2012, the results of the survey "Eurobarometer" that tracks the level of anxiety and concern among residents of the Old World were published. It turned out that 71 percent of the EU citizens consider the economic situation in the country poor.

30 percent of the residents of the EU assess their position in the labor market as unsatisfactory. 100 percent of Greek believes that the economy is in trouble. The same opinion on the state of the national economies was expressed by 99 percent of the population of Spain, 96 percent of Irish, 93 percent of Hungarians and 92 percent of Italians.

However, according to the same survey, there are optimistic countries, whose people consider the situation in their countries more than acceptable. Among them are 83 percent of Swedes, 77 percent of Germans, 66 percent of Austrians and 55 percent of Danes.

According to head of the Scientific Research of Mises Center Yaroslav Romanchuk, now there is a situation where we have two Europes – a happy one (mainly Germany and Scandinavia), and the rest – about 20 countries, and the difference between the two Europes is turning into an abyss. The consequence of this situation is growing nationalism, resentment, and envy.

The crisis also affected most affluent segments of the population of Europe. According to a research by Capgemini and Royal Bank of Canada, the wealth of millionaires not only in the EU, but in the entire world in recent years has declined. The exceptions are, perhaps, only the fat cats in the Middle East. Last year, the total wealth of the world's millionaires fell by 1.7 percent – the first such decline since 2008.

The number of the super-rich decreased by 2.5 percent. The report's authors say this is due to the fact that wealthy people abroad often invest their money in low liquidity and high risk assets – such as real estate

However, statistics shows an increase in the number of millionaires in Europe at 1.1 percent due to the fact that the wealthy people of the continent now prefer to invest in foreign assets. The largest number of wealthy people now lives in the Asia-Pacific region.

Chinese business advisor Andy Xie believes that the measures taken by the European leaders to improve the economic situation in the region cannot put an end to the crisis and are not radical and convincing enough. The expert sees the main cause of the crisis in their irresponsibility. The EU countries have broken the rules of their own game in terms of the budget deficits and mired in debt. Endless loans that were handed out in the past, sooner or later, would lead to a crisis.

The European leaders have asked the international community to support their nation, saying that otherwise the global economy will get worse. According to Xie, since Europe is the main trading partner of China, export-oriented Chinese firms are ruined. It is not just China – Europe is the main source of technological and industrial maintenance for Africa, and the crisis in Europe affects the situation in the most negative way.

Germany proposes to introduce austerity measures to cut all kinds of benefits and wages in the troubled areas of Europe, mainly in its south. However, these measures are becoming increasingly more ineffective and unpopular – unemployment is rising, the standard of living is falling, and the positive trend is not visible.

Andy Xie said that the inefficiency of today's economy of Europe is due to its lavish social costs, ineffective trade unions, as well as confusing laws that prevent the development of competition. If the countries of Europe eliminate these obstacles to their development, the situation may markedly improve.

The administration of the U.S. President has sent to Europe the U.S. Treasury representative Lyle Brainard to encourage the governments of several countries in the anti-crisis measures. In particular, it is expected that the Eurozone stabilization funds will be used – about 700 billion euros – to recapitalize banks and provide financial assistance directly to financial companies, not the countries.

Poverty returns to Europe by leaps and bounds � Set You Free News

 

[hello_10]

Eurozone crisis has pushed millions into poverty
10 DECEMBER 2012

Crushed by an austerity squeeze and towering unemployment, millions of Europeans joined the ranks of the newly poor in 2012 in a crisis that showed no mercy for the old, women or children.

An arc of misery spread pitilessly across southern Europe's middle classes, engulfing bailed-out nations Greece and Portugal and tottering heavyweights such as the eurozone's number four economy, Spain, and number three, Italy.

"The black hole is getting bigger and bigger," fretted Mercedes Gonzalez, a 52-year-old Spaniard who has less than 800 euros ($1,000) a month to raise her unemployed family in the Madrid suburb of Fuenlabrada.

In July, she was still pocketing the monthly state aid of 426 euros for the long-term unemployed. But the benefit was slashed to 360 euros last month, she said, and in the meantime a September 1 rise in sales tax lifted the price of food and other regular bills.

"Things are really getting worse, we can't breathe already," said the energetic unemployed saleswoman whose voice betrayed weariness as she contemplated caring for herself, her carpenter husband and two of her three adult sons, all out of work.

Spain is displaying all the signs of a major social crisis, with one in four workers unemployed, an unprecedented austerity squeeze by the state, cuts to education and healthcare, and thousands of indebted families thrown out of their homes and into the streets.

In this country, where two home owners threatened with eviction recently committed suicide, as in other southern European nations such as Greece and Italy, the economic crisis is sowing implacable despair.

In Italy, the fate of an unemployed bricklayer who was being chased for unpaid taxes moved the entire country.

Giuseppe Campaniello set himself ablaze outside a tax office at the end of March and died after nine days of agony.

"You can't expect a self-employed bricklayer to pay taxes even for the months when he is not working. The state beats you up and Giuseppe paid the consequences," his 48-year-old widow said Tiziana Marrone from Bologna in central Italy told AFP.

"Giuseppe was not helped out. He felt he had his back to the wall. That morning he had to go to a criminal hearing for his taxes. It should have never got to that. We all make mistakes but he never stole from anybody!" she said.

"His was also a protest. Our laws drove him to it. It wasn't a suicide linked to the crisis, it was state-sanctioned murder," she said.

Marrone herself is now in a desperate situation as she has inherited her husband's massive debts and lives on an allowance of 450 euros a month. She is forced to rely on handouts from her pensioner mother to survive.

In Greece, the crisis delivered another fatal blow.

In April, a 77-year-old chemist shot himself in the head leaving a note that accused the government of stripping him of the resources to live.

In Greece, where the unemployment rate is the highest among industrialised nations at 25.4 percent in August, the crisis has hit people harder than any other nation in southern Europe: 31 percent of its inhabitants were at risk of poverty or social exclusion in 2011 compared to a European Union average of 24.2 percent.

George Tsouvalakis, a 31-year-old jobless carpenter, and his 30-year-old wife, Lia, are among a "lost generation" of thirty-somethings sacrificed by the crisis.

With their two-year-old daughter, Angelina, they are trying to leave the country but cannot afford the plane ticket. Their income fell from 2,500 euros a month before the crisis to between zero and 400 euros.

"We should not remain in the country anymore, that is what I see. But we don't have the financial capability to leave this country. That is our problem or else we would have already left," Lia said.

In Portugal, too, where 24.4 percent of the population is estimated to be at risk of poverty or exclusion, the crisis has mortgaged the futures of many young people.

After completing a master's degree in dramatic arts at the prestigious Coimbra University, 29-year-old Nilce Carvalho could not pick up her diploma because of the debts she had built up since the hard-up government slashed her grant from 400 euros to 98 euros.

To escape her debts, the young woman launched a public appeal on Facebook, overcoming "a kind of shame".

"There are lots of young qualified people in our country but there is just no work for us," Carvalho said.

Across southern Europe, humanitarian groups are confronting rampant poverty in all its guises.

"These are families in which every member of working age is out of work, people who lost their home because they were evicted, who are not used to turning to social protection networks," said Fernando Cuevas, spokesman for the Spanish Red Cross.

"Where is the middle class today in Spain?" asked David Polo, who looks after the homeless for Caritas in Burgos, a northern Spanish town. "It's breaking up. We are starting to see a polarisation of this class."

Humanitarian groups are especially worried about women and children.

The UN children's fund UNICEF estimated there were 2.2 million children living below the poverty line in Spain. In Portugal, the education ministry has sounded the alarm because in the space of just 20 days the number of pupils lacking food leapt from 10,000 to 13,000.

Even pensioners, some of them looking after entire families, are no longer safe: the right-leaning government in Spain has announced that the rise in retirement pensions will be less than had been expected in 2013, breaking an oft-repeated electoral promise.

And on Sunday, thousands of doctors and other health workers took to the streets of Madrid to decry government plans to privatise some health services.

Eurozone crisis has pushed millions into poverty - FRANCE 24

 

[hello_10]

UK heading for triple-dip recession as GDP shrinks 0.3% in fourth quarter

UK economy not expected to regain peak level for another two years – marking slowest recovery in a century

Britain could be on course for its third recession in four years after the economy shrank 0.3% in the last three months of 2012.

The figures were worse than expected and could put pressure on the government to consider a "plan B" that would stimulate demand.

A fall in manufacturing output dragged down the economy, countering a small rise in construction between October and December, according to the Office for National Statistics. The economy achieved zero growth for the year as a whole.

Sterling dived on the news, reflecting fears the UK will lose its AAA credit rating and status as a haven economy, though the stock market shrugged off the news, remaining at a four-year high.

George Osborne said he would not "run away" from the problems facing the UK economy: "We have a reminder today that Britain faces a very difficult economic situation. A reminder that last year was particularly difficult, that we face problems at home because of the debts built up over many years and problems abroad with the eurozone, where we export most of our products, in recession."

The shadow chancellor, Ed Balls, called on Osborne to introduce policies which will "kickstart our flat-lining economy". "A plan B now should include a compulsory jobs guarantee for the long-term unemployed and a temporary VAT cut to boost family incomes and our struggling high streets," said Balls.

The Trades Union Congress (TUC) general secretary, Frances O'Grady, said the chancellor's austerity plan had "pushed the UK economy to the brink of an unprecedented triple-dip recession".

A triple-dip recession will occur if the economy contracts again in the first quarter of 2013. The economy remains 3.5% below its peak in 2007 and is not expected to regain its previous level for at least another two years, making it the longest recovery in 100 years.

"We are now midway through the coalition's term of office and its economic strategy has been a complete disaster. We remain as dependent on the City as we did before the financial crash," O'Grady said.

In the 10 quarters since the election, manufacturing has contracted by 0.4% and the construction sector has shrunk by 9%, the TUC said.

The contraction in GDP in the fourth quarter followed a near 1% rise in the third quarter when the economy was boosted by the Olympics.

A survey of economists had predicted a 0.1% drop in GDP in the fourth quarter, though several prominent analysts had forecast a bigger contraction after a series of surveys last year showed the manufacturing industry suffering from a downturn in exports.

The ONS data showed that within the manufacturing sector, mining and quarrying output suffered its biggest decline since records began because of maintenance on North Sea oil and gas fields.

In the powerhouse services sector activity ground to a halt in the fourth quarter due to the absence of the London Games boost in the previous three months.

The only bright spot was construction, which delivered a 0.3% rise in output. A post-Olympic cut in spending on sport and recreational facilities pushed down the index for government and other services by 0.7%, after an increase of 1.6% in the previous quarter. All Olympic ticket sales were counted in the previous quarter, giving the ailing economy a one-off boost.

Despite the contraction in the economy, employment has remained resilient, with figures this week showing that almost 30 million adults were in a job in the quarter to November, up by more than half a million on the previous year.

The Bank of England governor, Sir Mervyn King, said this week the UK had been slower to recover than most other countries. But he insisted there were signs of a "gentle recovery" under way and asked Britons to be patient.

Lee Hopley, chief economist at EEF, the manufacturers' lobby group, said there was little positive news from the figures. "Even assuming some unwinding of activity from the Olympics boost in the previous quarter, this still leaves no real signs of underlying growth in the economy. The news from industry was particularly weak, with November's sharp drop on output contributing to a rather grim fourth quarter and leaving the overall picture for manufacturing in 2012 the weakest since 2009."

UK heading for triple-dip recession as GDP shrinks 0.3% in fourth quarter | Business | guardian.co.uk

 

[hello_10]

its interesting to see that out of total GBP 2,352 million remittance outflows from Britain, around GBP 1.16bil goes to just one country, Pakistan before 1972, ( or to two countries, Pakistan and Bangladesh). while Britain itself is the 14th largest receiver of remittances from the world right now and Pakistan and Bangladesh on 7th and 11th place?

The UK is a receiver as well as a sender of remittances. As shown in Figure 1, the World Bank estimates suggest that since the mid-1990s the UK has been a net-remittance receiver. The main countries from which remittances are sent to the UK include Australia, the United States and Canada (World Bank 2010). Real remittance inflows (inflation adjusted) for the UK have increased by an annual average of 6% since 1989, reaching close to GBP 4,647 million in 2009. However, these inflows represent a small share of the UK GDP (about 0.3% in 2009). The UK occupies the fourteenth place in the world in value of remittances received and the sixth place in Europe.

From 1989 to 2009, remittance outflows from the UK increased by an annual average of about 4% in real terms, reaching close to GBP 2,352 million in 2009.

The UK accounted for around 7% of annual remittances to Bangladesh in 2010 (about GBP 533 million) and about 10% of annual remittances to Pakistan during that year (about GBP 627 million)

Bangladesh and Pakistan occupy the seventh and eleventh positions respectively in terms of the global inflow of remittances

Migrant Remittances to and from the UK | The Migration Observatory

 

[hello_10]

with the above news in post#54, that Britain received GBP 4,647 millions remittances in 2009 as compare to hardly GBP 2,352 million outward remittance, making it the 14th largest remittance receiver of the world, just behind Pakistan & Bangladesh, who combined received half of the British outward remittance (GBP 1.16 billions) :thumb:

now we have a news as below that total outward remittances from India was around $10.7 billions (around GBP 7,000 millions) in 2011, which would have reached the level of well over $13 billions+ (GBP 9.0 billions) by 2012. here we hope that at least GBP 500mil+ might be going to UK itself from India, covering the losses they face from remittances to Pakistan before 1972 :thumb:

According to a Nomura report, multinational companies have been pulling money out of India at an accelerating rate, moving $10.7 billion out of the country in 2011, up from $7.2 billion in 2010 and just $3.1 billion in 2009.

Foreign cos pulling more money out of India-Nomura | Reuters

 

[hello_10]

European stocks rebound on "less bad" Eurozone Composite PMI report.
FEBRUARY 5, 2013

Tuesday's trading session saw all of the major European stock indices rebound from Monday's swoon after Markit Economics reported that its Final Eurozone Composite PMI for January rose to 48.6 from December's 47.2 and the Flash estimate of 48.2 (NYSEARCA:VGK). The reading remained in the contractionary range (below 50) and the language of the report used a good deal of "less bad" terminology. For example:

Although signalling a further deterioration in output of the Eurozone private sector economy, the rate of decline has now eased for three straight months.

The following is the report's breakdown of five Eurozone nations, ranked by Composite PMI. The presence of France on the list – with its off-the-charts dreadful reading, makes it obvious that this is not the top five list:

Ireland: 54.9 (2-month high)

Germany: 54.4 (19-month high)

Spain: 46.5 (19-month high)

Italy: 45.4 (2-month low)

France: 42.7 (46-month low)

Eurozone Composite PMI Report Rescues Stocks

 

[hello_10]

Switzerland arming in preparation for European meltdown
12 October, 2012

The Swiss Army is preparing contingency plans for violent unrest across Europe. A nation mostly famous for its banks, watches and chocolate fears it may face a massive influx of European refugees in the near future.

One of the world's richest nations openly expressed concerns over the possible outcome of Europe's continuing financial troubles, and is currently conducting army exercises against the possibility of riots along its borders.

In September, the Swiss military conducted exercises dubbed 'Stabilo Due,' with scenarios involving violent instability across the EU.

Switzerland has maintained an avowedly neutral stance for decades, and refused to join the eurozone when presented with the opportunity.

Bern's biggest fear is likely the disorganization of neighboring nations' armies that would follow general instability; the eurozone crisis and the severe austerity measures in the EU are forcing member-states to significantly slash their military budgets. If protest continues to spread across Europe, police and armed forces may find themselves ill-equipped to manage the unrest.

"I will not rule out that we will need the army in the coming years," Swiss Defense Minister Ueli Maurer said last Sunday.

The Swiss Defense Ministry has pressed ahead to modernize the country's army despite political opposition. With its multibillion-Franc military budget and an army of around 200,000 soldiers, the country also plans to purchase new 'Saab Gripen' jet fighters.

Switzerland arming in preparation for European meltdown? — RT

Euro-Zone Economy Plunges
February 14, 2013

The euro-zone economy plunged last quarter at its fastest pace in nearly four years, as weakening global activity and deep recessions along the currency zone's southern border gripped powerhouses such as Germany and France.

The report on gross domestic product from the European Union's statistics office highlights a key risk for the currency bloc as Europe's debt crisis enters its fourth year. Financial market conditions have improved markedly since last summer, due in large part to the European Central Bank's pledge to do "whatever it takes" to preserve the euro. But these gains haven't translated into new business activity.

Without growing economies, Spain and Italy will likely see government-debt burdens increase even as they undertake austerity measures such as higher taxes and reduced spending. That could revive doubts in financial markets about the sustainability of their finances.

GDP in the euro zone fell 0.6% in the fourth quarter compared with the third, according to the Eurostat report. That translates into an annualized decline of 2.3%, according to J.P. Morgan JPM -0.69% economist Greg Fuzesi. Economists had expected a 0.4% quarterly drop. It was the third straight GDP decline and fifth straight quarter in which the currency bloc failed to expand. For 2012 as a whole, GDP fell 0.5% from the prior year.

The report "brought a dismal end to a very difficult year for the euro zone," said Howard Archer, economist at IHS Global Insight. He expects GDP to slide another 0.2% this year.

The euro fell to a three-week low on the weaker-than-expected figures.

GDP in Germany, Europe's largest economy, fell 0.6% from the previous quarter on declining exports and investment, or 2.3% at an annualized rate. France, the bloc's second biggest, declined at a 1.1% annualized pace. Other large economies including Italy, Spain and the Netherlands also contracted.

Italy's GDP plummeted at a 3.7% annualized pace, a much sharper rate of decline than the third quarter. Spain's downturn also deepened. Portugal's GDP slid at a 7.2% rate in the final three months of 2012, double the third quarter's pace of decline.

Greek GDP contracted 6% compared with year-ago levels. Its statistics agency didn't provide a quarterly change, but Mr. Fuzesi estimates that GDP slumped 16%, at an annualized rate, from the third quarter. Greece's unemployment rate rose to 27% in November, a record.

ECB officials expect the euro zone to embark on a gradual recovery later in 2013, and aren't expected to cut official interest rates in the near term despite the GDP slide, analysts said.

But the source of that rebound remains elusive. Record-high unemployment in the euro zone has weighed on consumer spending, while fiscal austerity measures are expected to weaken state spending and employment in many euro countries this year. Borrowing costs for small businesses remain elevated in Spain and Italy.

In Germany, where unemployment is much lower than other parts of the region, the economy appears to be bouncing back quickly with business surveys signaling a return to growth this quarter, aided in part by stronger exports to Asia. Weakness in late 2012 "is likely to be a springboard for a small V-shaped rebound" as soon as this quarter, said Berenberg Bank economist Christian Schulz.

Surveys of purchasing managers and other business leaders suggest France continues to contract this quarter. French industry lost global competitiveness in recent years as its labor costs rose, economists say. A raft of tax increases imposed by President Francois Hollande is adding to the headwinds facing the economy.

The French government is preparing to at least halve its 0.8% GDP growth forecast for this year, officials familiar with the matter told The Wall Street Journal earlier this month. The smaller size of the economy and fall in tax receipts is also derailing government plans to cut the budget deficit to 3% of GDP this year.

-Gabriele Parussini contributed to this article.

Euro-Zone Economy Plunges - WSJ.com

 

[parijataka]

^^^^
I think there will be influx into Europe ober next few years, already is, from impoverished African countries and unstable Asian countries like Pakistan and A'stan due to the generous welfare policies of countries like UK where a so-called asylum seeker is given housing and other benefits the minute he lands. Once in UK I think their legal system makes it impossible to deport anyone. Extremists from other countries (not getting the name of the Egyptian cleric with one eye and a claw for a hand who could not be deported) find UK a safe haven as their lawyers argue there is danger to their clients if deported. UK even provides child support to families of polygamous immigrants/asylum seekers who are married before they enter UK !

So while the whites leave for greener pastures in Australia, NZ, US, Canada, etc they will be replaced by Africans and Asians.

 

[hello_10]

^^^^
I think there will be influx into Europe ober next few years, already is, from impoverished African countries and unstable Asian countries like Pakistan and A'stan due to the generous welfare policies of countries like UK where a so-called asylum seeker is given housing and other benefits the minute he lands. Once in UK I think their legal system makes it impossible to deport anyone. Extremists from other countries (not getting the name of the Egyptian cleric with one eye and a claw for a hand who could not be deported) find UK a safe haven as their lawyers argue there is danger to their clients if deported. UK even provides child support to families of polygamous immigrants/asylum seekers who are married before they enter UK !

So while the whites leave for greener pastures in Australia, NZ, US, Canada, etc they will be replaced by Africans and Asians.

US/UK are mainly suffered with the heavy Social Security+Medical expanses budget which they can't bear on the long run. and hence high Budget deficit so borrowing more, which they are less likely to pay back in future

for example of UK as below, along with the news of post#46, their 28%+18% = 46% Budget Expenditure goes for just Social Security+Medical, which still excludes 13% for education and rest the government expenditure to run the country. and how long they may have this luxury, to keep their people out of slum 'anyhow' by borrowing more than their capability, we all are waiting to see :ranger:

United Kingdom budget - Wikipedia, the free encyclopedia

 

[hello_10]

Britain is losing the economic Olympics

As London prepares for another display of British pageantry and good humor to match the unlikely triumph of last month's rain-sodden Royal Jubilee, a less impressive aspect of Britain's stoical "stiff upper lip" may detract from the national pride associated with hosting the Olympics. In the global race out of recession, Britain has just been revealed as a prime contender for the wooden spoon.

Not only was the shocking drop of 0.7 percent in Britain's second-quarter GDP reported on Wednesday much bigger than investors and independent economists had expected but it almost matched the 0.8 percent fall in Italy's GDP the previous quarter. And that Italian drop holds the record for the biggest quarterly contraction suffered by any G7 country since the immediate aftermath of the Lehman crisis. Much more important than such statistical trivia is the fact that Britain's economic output is still 4.5 percent below the peak level it reached in the first quarter of 2008, more than four years ago. The U.S. and German economies, by contrast, are now significantly bigger than they were before the crisis and, in this sense at least, have left the recession behind them. And even the euro zone as a whole, despite the severity of its financial crisis, has done much better than Britain, with GDP just 2 percent below its peak in 2008.

National economic performance is not, of course, a competitive Olympic sport, and there is more to economic success than GDP growth. Still, there is a good reason for connecting the Olympics with economics: International competitions and comparisons can teach useful lessons and create incentives to improve economic management.

The most instructive international comparison at present is between the British and American efforts to clamber out of recession and financial crisis. This race is about as close as economics can get to a controlled experiment of the kind favored by natural scientists, in which sharply different policies are applied to two countries with broadly similar structures and initial conditions, facing similar economic problems.

In 2008, the U.S. and Britain were two advanced economies with large financial sectors, dangerous housing bubbles, heavy consumer debt and similar government deficits and debt levels relative to GDP. Both suffered extremely severe banking crises that forced their governments to take on huge additional liabilities by guaranteeing their biggest banks. For two years after the Lehman crisis in September 2008, the two economies followed broadly similar policies: slashing interest rates to zero, allowing large expansions of their budget deficits and financing the resulting debt with newly printed money. The two economies moved closely in tandem, as economic theory would have predicted: both on the way down until mid-2009 and then on the way up until mid-2010.

But then, in the summer of 2010, the newly elected British government set a radically different course for one very specific and controversial aspect of economic policy – government borrowing. Instead of simply tolerating the big budget deficits that had resulted from weak economic growth, as both the U.S. and British Treasuries had done until 2010, David Cameron decided his top priority would be to reduce government borrowing. He planned to do this by slashing public spending and imposing substantially higher tax rates. The U.S. government, meanwhile, continued with a fiscal policy of benign neglect. Despite all the sound and fury in Washington about deficits and debt limits, U.S. tax rates and public spending plans remained broadly unchanged through 2011 and 2012, with a small cut in payroll taxes largely offsetting the fiscal impact of cuts in local government spending and employment. In all other respects conditions in the two economies remained unchanged. Both central banks continued to print money and to keep interest rates near zero. The dollar and the pound moved very little against one another, and exports grew moderately in both countries, despite the crisis in the euro zone. In short, this really was a controlled experiment on the impact of different fiscal policies.

Curiously enough, the two economies began to diverge from the moment this controlled experiment started, with the British economy contracting in the third quarter of 2010, while growth accelerated in the U.S. In the period since then, the U.S. economy has expanded by 2.7 percent, while Britain has contracted by 0.8 percent. The latest results of this experiment will be revealed on Friday, when the U.S. GDP figures are published and can be compared with the 0.8 percent fall in British GDP just announced.

It may be said, of course, that the British policy of fiscal consolidation was still justified, even if the U.S. enjoys much stronger growth, as it almost surely will. After all, controlling public debt and deficits is an important national objective that counts for more than simply juicing up short-term growth.

But this is where we get to the really significant and surprising feature of the race out of recession. Britain's heroic spending cuts and tax increases imposed by the Cameron government may contrast starkly with lassitude and cowardice displayed by politicians in Washington. But this dramatic political contrast has made absolutely no difference on the debt and borrowing outcomes the two countries have actually achieved, because the British austerity has simply prolonged recession, while U.S. fiscal laxity has allowed the economy to grow. According to the latest IMF figures, published two weeks ago, the U.S. budget deficit has been reduced from 10.5 percent of GDP in 2010 to 8.2 percent in 2012. This reduction is a slightly bigger reduction in the deficit than Britain has managed to achieve in the same period – from 9.8 percent to 8.1 percent.

In short, any country determined to control public borrowing should forget about fiscal austerity and instead do everything to grow as fast as it can – a fitting economic message from Olympic Britain.

Britain is losing the economic Olympics | Anatole Kaletsky

Divided euro zone economy declines further in February - PMIs
March 5, 2013

France, Spain and Italy dragged the euro zone into a deeper downturn in February, according to business surveys on Tuesday that showed the chasm between these countries and prosperous Germany has widened yet again.

Markit's Eurozone Composite PMI, a broad gauge of activity at thousands of companies across the 17-nation bloc, fell to 47.9 in February from 48.6 in January.

Although that was a little better than a preliminary reading of 47.3, it was still well below the 50 mark dividing growth from contraction - as the index has been for just over a year.

The survey reflected how euro zone businesses were faring mostly before the inconclusive outcome of Italy's general election, which unsettled international financial markets.

While a better end to the month in Germany and France drove the final number higher, the gap between the euro zone's two largest economies has grown to its widest since the survey started in 1998, Markit said.

Spanish and Italian businesses endured another dire month.

"The outlook ... seems to largely depend on whether Germany can continue to expand and offset the weakness in France, Italy and Spain," said Chris Williamson, chief economist at survey compiler Markit.

"(That) seems a tall order, meaning hopes of a return to growth for the region by mid-2013 are now looking too optimistic."

The German composite PMI, released earlier on Tuesday, showed growth slowed last month from a 19-month high.

Williamson said the latest surveys were consistent with the euro zone economy shrinking around 0.2 percent this quarter, with only German strength saving the bloc from a downturn as bad as the 0.6 percent decline at the end of last year.

A poll of economists last month suggested the economy will merely stagnate this quarter, although that was conducted well before Italy's election.

That made it more likely the European Central Bank will have to help struggling countries such as Spain by buying their bonds, a Reuters poll showed last Thursday.

However, few expect any reduction in interest rates, already at a record low, to come this week.

The composite new business index, which often presages rises and falls in the next month's PMI, dropped to 46.7 from 48.0.

Services companies that comprise the bulk of the economy, ranging from restaurants to multinational banks, had another poor month in February.

The services PMI fell to 47.9 from 48.6 in January, although like the composite index, it was revised up from a preliminary reading of 47.3.

These companies cut jobs at a marginally slower pace in February, although it looks like it will be a long time before firms start hiring staff in earnest.

The euro zone's jobless rate hit an all-time high in January, according to figures from last Friday, as another 201,000 people fell out of work in the month.

Divided euro zone economy declines further in February - PMIs - IBTimes UK