Today the Wall Street Journal is reporting that German industrial output for the 4th quarter of 2012 likely fell below the output for the 3rd quarter, making it possible that Germany could lapse into recession.
Tag: double dip
The election is now over and it’s time to think about what is to come. The most pressing political concern is the so-called fiscal cliff that has resulted from a budget deal Washington’s politicians cobbled together to avoid default during the first debt ceiling debacle. I believe the fiscal cliff is genuinely something to worry about. And I will be debating […]
This crisis has broken a lot of economic taboos, with central banks buying up assets and expanding their balance sheets in a desperate effort to reflate a debt-laden private sector. The goal is to maintain economic growth, even at the risk of releveraging within the private sector to make up for a loss of private income-based demand. I think things […]
As the Eurozone recession (which started months ago) worsens, the area’s manufacturing activity, as measured by the PMI index, is contracting at a pace not seen since 2009. A great deal of this decline however is now driven by Germany (rather than the periphery), whose manufacturing PMI is showing a rapid deterioration.
Case-Shiller came out with some numbers earlier today, showing they too will soon be confirming the housing recovery in the US.
I think it goes without saying that the problems for Spanish and Italian regional governments are due to the austerity-induced double dip recession those economies are suffering. The real insight here is that this municipal – double dip nexus is transferable beyond Spain and Italy because key municipal and state revenue sources fall dramatically in these cases.
We first noticed the first signs that the economy was beginning to soften about three months ago. Now the evidence of a slowdown has become so overwhelming that it is difficult to avoid the conclusion that we are headed for a recession. We cite the following as evidence.
Just to put some meat on the bones around the cyclical downturn turning into recession, the personal income data paint a negative picture absent debt accumulation. What we see in recessions is that personal income leads the cycle and when the growth in disposable personal income(real or nominal) turns down, spending also turns down. This usually triggers recession.
Retail sales are at recessionary levels right now, having dropped for a third consecutive month. I need to flag the inventories data that came out this morning in the US as the only thing between us and outright recession.
The June retail sales report was simply dismal. Not only did sales decline by 0.5% in June rather than rise 0.2% as the consensus expected, but the April data were revised. The measure used for GDP calculations, excludes gasoline, auto and building material sales fell 0.3% for the second consecutive month.
I would love to see ECRI explain why they have changed the date when they felt recession would begin and whether this means they were wrong in forecasting recession in 2011. yesterday, I said ” I don’t think Achuthan is changing his story in the least.” I can’t say that now. It certainly looks to me now like ECRI was wrong initially and that Achuthan has changed his timetable subsequently.
I have Bloomberg copy and a video of a recent performance by ECRI’s Lakshman Achuthan on Tom Keene’s show. A lot of people have been pouring scorn on business cycle forecaster Achuthan because of his company’s recession forecast. I suspect most of it is driven by bulls annoyed by his downbeat forecast or by the media’s instinct for gotcha with prognosticators.