Massive Disappointment

Annualized Growth Downgraded

Note that Eurozone quarterly results are not annualized, unlike the US. The reported 0.2% in the Eurozone would equate to a report of 0.8% to 0.9% in the US.

Risks of Global Recession Rising

The Guardian has Live Coverage of Eurozone GDP.

> Alastair Neame, senior economist at economics consultancy CEBR, is concerned that Germany’s economy has faltered over the summer.

CEBR Comments


  • “Eurozone growth of 0.2% in Q3 is the slowest rate of expansion since Q2 2014, which indicates that, amongst a range of risks, global trade worries may be having a bigger effect on business confidence than had been expected. With French GDP growth having risen to 0.4%, German growth is now under the spotlight as the currency bloc begins to stagnate.“
  • "Despite Germany showing some signs of labour market strength, as unemployment fell to the lowest rate since 1990 (5.1%), the economic outlook is somewhat clouded. The latest business surveys indicate that economic sentiment in Germany has waned as a result of growing global uncertainty. The Ifo business climate index fell for the second consecutive month to 102.8 points in October."
  • "Cebr estimates that the risk of a global recession in the next two years has risen from a fifth a year ago to a third this autumn."
  • As global business cycles mature, trade conflicts and emerging market crises could combine to tip the world into a downturn exacerbating the Eurozone’s problems.

Persistent Brexit uncertainty and Donald Trump’s trade wars are both being blamed for derailing to derail the eurozone recovery.

Rome’s borrowing plans already breach EU rules; if the economy is smaller, then the deficit will be an even larger share of GDP.

Global Recession Definition

The CEBR did not define, at least in those comments. There is no widely agreed upon definition.

Wikipedia notes "Before April 2009, the IMF argued that a global annual real GDP growth rate of 3.0 percent or less was "equivalent to a global recession". By this measure, there were six global recessions since 1970: 1974–75,[1980–83, 1990–93 1998, 2001–02, and 2008–09.

I would use a tighter definition of 2.0% or less.

I expect a global recession and the US will not be immune. China did not decouple in 2007 and the US will not decouple in 2019.

The Fed does not see this coming.

Mike "Mish" Shedlock

Too Big to Bail, Too Big to Jail: Italy in Recession With Very Troubled Banks

Italy is back in recession. The pattern of weak growth ever since it joined the Eurozone is easy to spot.

Global Recession Now Baked in the Cake

The JP Morgan, Markit Global Manufacturing PMI signals a global recession.

Permanent Recession for Italy?

The Telegraph warns of a possible permanent recession for Italy.

Comparison of Systemic Risk in China, US, Eurozone: Systemic Risk is Everywhere

China leads the world in economic growth but that growth is 100% debt-driven. China's recent $10 trillion in growth comes from $10 trillion in additional debt. In total, China has $26 trillion in debt. Debt is a huge systemic risk, but it's not just China.

Italy's Mini-BOT Trojan Horse Could Blow Up the Eurozone

Italy threatens to create a parallel currency dubbed the Mini-BOT. If launched, it could lead to a Eurozone breakup.

Italy Heads for 2nd Lost Decade, Entire Eurozone on Verge of Contraction

Italy's GDP is still below the 2008 level. PMIs from Germany and Italy show the entire eurozone on verge of contraction.

US, Germany, Japan in Manufacturing Recessions: Full-Blown Recessions Coming Up

The US, Japan, Germany, and the Eurozone manufacturing PMIs are in contraction. Recessions will follow.

Global Growth: Sputter, Stutter, Mutter

Global economic growth is sputtering, and it isn't the weather.

Italy’s Miserable Eurozone Experience: 20 More Years of Woe Coming

The Euro was supposed to lift all boats. Italy was left behind, and will stay there for two more decades according to the IMF.