Friday, November 13, 2015

A World of Low Expectations

"The slowdown underlines the tepid nature of the eurozone’s economic recovery, which began in mid-2013 but has now eased for the second straight quarter. Weak growth has left the economy still 0.5% smaller than it was at its largest in the first three months of 2008."

The above quotation, taken from this morning's Wall Street Journal, is the latest report on economic progress in the Eurozone.  No growth is now the norm for the Eurozone.  Greek results were cheered.  Here's how things are going in Greece:

"The Greek economy contracted by 0.5%, but that was a better outcome than economists had feared, having expected a drop of 3% after capital controls were introduced in June as the leftist government scrambled to prevent a collapse of the financial system amid doubts over the country’s future in the eurozone."

Meanwhile, Mario Draghi promised more quantitative easing, a policy that has consistently failed everywhere in the western world to produce results.

So, essentially zero growth in the Eurozone and no expectations for improvement. 2 percent growth in the US, less than half of the normal recovery rates following a severe contraction.  Not only is economic growth over for the West, but expectations have been lowered to match the reality.

Having demolished free markets for the past decade, Europe and the US are reaping the rewards of an absurd economic policy.  Patterning your economy after the old Soviet Union is not a ticket to prosperity.  But, Europe and the US no longer expect prosperity, mired in economic stagnation for the foreseeable future.

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