Washington Post: Europe Is Stuck In a “Greater Depression”

“It’s a Little Misleading to JUST Call This a Depression. It’s WORSE than That”

The Washington Post’s Wonkblog reports:

Europe hasn’t recovered, because it hasn’t let itself. Too much fiscal austerity and too little monetary stimulus have, instead, put it more than halfway to a lost decade that’s already worse than the 1930s.

It’s a greater depression.

And as the latest GDP numbers show, it’s not getting any less so. Indeed, the eurozone as a whole didn’t grow at all in the second quarter. Neither did France, whose economy has actually been flat for a year now. Germany’s economy fell 0.2 percent from the previous quarter—and that after revisions revealed it had quietly gone through a double-dip recession in early 2013. Though that’s still much better than Italy: Its GDP also fell 0.2 percent, but its triple-dip recession has now wiped out all growth since 2000. The closest thing approximating good news was that Spain’s dead-cat bounce recovery continued with 0.6 percent growth. But it still has 24.5 percent unemployment.


But it’s a little misleading to just call this a depression. It’s worse than that. Europe is turning Japanese. The combination of zombie banks, a rapidly aging population and, most importantly, too-tight money have pushed it into a “lowflationary” trap that makes it hard to grow, and is even harder to escape from.

We agree with the diagnosis, but not the cure …

Diagnosis-wise, we noted last year that the British economy is worse than during the Great Depression.

But the “austerity” versus “stimulus” debate is a false dichotomy.    If a patient is bleeding out, doctors have to suture the wounds before they decide whether to give more blood or to taper off the amount of transfusions.

But Europe has never treated the wounds …  As we noted in 2011, failing to prosecute financial fraud – on either side of the Atlantic – is extending the economic crisis.

In 2012, we pointed out that European (and American) governments were encouraging bank manipulation and fraud to cover up insolvency … trying to put lipstick on a pig.


  • Quantitative easing hurts the economy. Even the Bank of England and the creators of QE admit that it is “pushing on a string“.  But the UK did tons of QE instead of actually fixing the economy

Heck of a job, guys …

This entry was posted in Business / Economics, Politics / World News. Bookmark the permalink.
  • Steven

    Heck of a job, Washington! Really!! I don’t know how you do it. Didn’t you say you have a day job as well? (I’ll bet you have a research staff of hundreds.)

    • WashingtonsBlog

      Thanks, Steven … yes, I have a busy professional day job, and my research staff is … I’m it 🙂

  • Bobnoxy

    This is becoming one of the best sources of information out there, stuff we never seem to get in the mainstream media. We should be telling everyone about this site.

    • Kathy Irwin

      I earn a lOt of mOney through online jobs .i get paid ninety Four dollars(94$) per hour working from home with 3 kids at home. I never thought I’d be able to do it but my best friend earns over SEVENTEENk(17k) a month doing this and she convinced me to try. The potential with this is endless and successful . Heres what have been doing ……

      THE link is given below ==













      open it in a new tab and you will receive all information…….


    Jay Taylor on the Unwinding of Western Economies and the Next Golden Bull
    With Anthony Wile – August 17, 2014

    Introduction: Jay Taylor is the editor of J Taylor’s Gold, Energy & Technology Stocks newsletter. Throughout his career, Mr. Taylor worked as first a commercial and then as an investment banker. Most recently, he worked in the mining and metals group of ING Barings in New York. Prior to that he was involved in the first gold loan made in modern times in the U.S. to Amax Minerals, a 250,000 oz. loan facility led by Citicorp. In 1997 he resigned from ING Barings to devote himself full time to researching mining and technology stocks, writing about them in his newsletter, and assisting companies in raising venture capital.


  • hanorabrennan

    Hey, try living in Ireland where we’ve well and truly been sucker punched by the banks and corporates. Some of them are even hiding out in the USA with the government’s connivance. We’ve more than paid for our greed but we’re slowly getting there. We have to keep hoping that Britain does not surrender to the german’s demands of fiscal sovereignty. If so, there goes my pension out the window.