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“The Eurocracy Fiddles While Continent's Economy Declines”
by Wall Street journal   
September 24th, 2010

If you can't solve a really important problem, create one that you can solve. So while the eurocracy fiddles with charges and countercharges of Nazi-ism over the issue of sending gypsies home, the economy burns. And not because it is overheating.

"Europe lags other major regions of the world in terms of economic recovery…" Although it is still growing slowly, continues the report of the Economic Group at Wells Fargo Securities, "the recovery in the euro zone is hardly self-sustaining at present…" David Owen, chief European financial economist for Jeffries International concurs, "We have had more evidence of activity in much of the EU losing some momentum… hardly surprising… given much of the growth seen in Q2 was inventory led." To which Goldman Sachs adds that "the softening global demand environment creates headwinds for exports."

Industrial production in the euro zone does not seem to be growing, after a Germany-driven period of growth in the first half of the year. The optimism engendered by that growth has also faded. The index of expectations for the German economy—based on a survey of financial analysts—dropped 18 points into negative territory in September, the largest drop in close to two years.

There are multiple reasons for the replacement of first-half euphoria with gloom. Perhaps most important is the market's expectation that if Greece falls the other peripheral dominoes, with Spain a possible exception, will follow. Consider the argument mounted by Greek finance minister George Papaconstantinou to support his position that Greece will not have to restructure its €300 billion ($390 billion) debt. "If Greece restructures, why on earth would people invest in other peripheral economies?"

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