Well, it is not as if I relish rubbing salt into old wounds, but this quote from the a href="http://www.ft.com/cms/s/0/8bb0da5a-c7dc-11de-8ba8-00144feab49a.html"latest piece by Ben Hall in Paris and Ralph Atkins in today's Financial Times/a is just too good to resist.br /br /blockquoteFrench manufacturing output rose at its fastest rate for nine years, according to a survey on Monday, confirming that France has become the economic powerhouse of continental Europe. Purchasing managers’ indices for manufacturing showed France performing significantly better than the continent’s other main economies – thanks to robust domestic demand./blockquotebr /br /a href="http://1.bp.blogspot.com/_ngczZkrw340/SvASaIFOk2I/AAAAAAAAPjI/Xa0wjOVFc3A/s1600-h/france+manufacturing.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 400px; DISPLAY: block; HEIGHT: 213px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5399836193272533858" border="0" alt="" src="http://1.bp.blogspot.com/_ngczZkrw340/SvASaIFOk2I/AAAAAAAAPjI/Xa0wjOVFc3A/s400/france+manufacturing.png" //abr /br /Plenty of food for thought in this paragraph it seems to me. As a href="http://spaineconomy.blogspot.com/2009/10/french-rebound-continues-in-october.html"foreshadowed in this earlier post/a, it is the French economy - and not the German one - which is rebounding sharply, and this ...

A spectre is haunting Europe, but this time it is not the spectre of revolt by the popular masses, or even one of yet another wave of bank bailouts. No, the spectre which is currently stalking the corridors of Europe's most prestigous institutions is one of a Spanish economy which stays on a flatline while Europe's other economies, one by one, start to struggle back to life. And the main reason that this particular ghostly image is giving everyone so many sleepless nights is because Europe's current institutional structures, and especially the monetary policy tools available at the ECB are scarcely prepared for such a nighmare eventuality.br /br /br /strongFrance Is Recovering, And The Rebound Is Robust/strongbr /br /First it was just a rumour, then it was a possibility, and now it has become a reality - some of Europe’s economies are springing back into life. But only some. It ...

Well, I never thought I would have to wait very long to get some confirmation of my last post on things that could go bump in the night in France, but even I wasn't expecting confirmation of what I was trying to get at so quickly. Now, according to a href="http://www.ft.com/cms/s/0/f7e77b94-c2e0-11de-8eca-00144feab49a.html"Frank Atkins in The Financial Times this morning/a:br /blockquoteThe eurozone has reported the first year-on-year fall in bank lending to the private sector, strengthening the case for the European Central Bank to maintain its ultra-loose interest rate policy. The latest eurozone credit statistics indicated lending had been scaled back at an unprecedented pace, even though signs have become stronger that the 16-country region’s economy has stabilised./blockquotebr /br /What are we talking about here?br /br /Basically bank lending to the euro area private sector shrank by an annualised 0.3 percent in September, according to the European Central Bank's monthly report, making ...

Whoever would have thought that some people once called economics the most dismal of sciences? Certainly, as the current crisis goes on and on, those of us who consider ourselves to be economists scarcely are able to find the time to squeeze in a dull moment, even here and there. But even at a broader level, interest in that most dismal of dismal topics - the theory and practice of central banking - seems now to fire up levels of enthusiasm here in Spain that make even the appetising prospect of a forthcoming Real Madrid-Barça football match pale in intensity. Even if it is the case, I have to admit, that the everyday Johnny (or Jill) come lately sitting in the bar still - truth be told - prefers the sports columns of the daily newspapers, or the lacivious details of the latest romantic adventure of one of the rich ...

Quietly clicking my way through Bloomberg last Sunday afternoon, a href="http://www.bloomberg.com/apps/news?pid=newsarchiveamp;sid=aC4zbsgMD6x8"I came across this/a:br /br /br /blockquotestrongFacebook Members Register Names at 550 a Second/strongbr /br /Facebook Inc., the world’s largest social-networking site, said members registered new user names at a rate of more than 550 a second after the company offered people the chance to claim a personalized Web address.br /br /Facebook started accepted registrations at midnight New York time on a first-come, first-served basis. Within the first seven minutes, 345,000 people had claimed user names, said Larry Yu, a spokesman for Palo Alto, California-based Facebook. Within 15 minutes, 500,000 users had grabbed a name. /blockquotebr /br /Mein Gott, I thought to myself, if 550 people a second are doing something, they can't all be wrong. So I immediately signed up. Actually, this isn't my first experience with social networking since I did try Orkut out some years back, but ...

French business confidence rose for the second month in May as record low interest rates and falling inflation appeared to be encouraging French consumers to start shopping again.. The Insee sentiment index - based on a survey among 4,000 manufacturers rose to 72 from 71 in April.br /br /pa href="http://2.bp.blogspot.com/_ngczZkrw340/Shz6mPuvaOI/AAAAAAAAOEM/CrtzAmlphDY/s1600-h/france+business+confidence.png"img id="BLOGGER_PHOTO_ID_5340418793119115490" style="DISPLAY: block; MARGIN: 0px auto 10px; WIDTH: 400px; CURSOR: hand; HEIGHT: 213px; TEXT-ALIGN: center" alt="" src="http://2.bp.blogspot.com/_ngczZkrw340/Shz6mPuvaOI/AAAAAAAAOEM/CrtzAmlphDY/s400/france+business+confidence.png" border="0" //abr /Consumer confidence also rose to a 13-month high, according to a separate gauge of consumer sentiment published today - it was up at minus 40, from minus 41 in April. The level is still, however, not far off historic lows.br /br /a href="http://2.bp.blogspot.com/_ngczZkrw340/Shz7oLxXLGI/AAAAAAAAOEU/DwxV6QUYuKU/s1600-h/france+consumer+confidence.png"img id="BLOGGER_PHOTO_ID_5340419925927734370" style="DISPLAY: block; MARGIN: 0px auto 10px; WIDTH: 400px; CURSOR: hand; HEIGHT: 213px; TEXT-ALIGN: center" alt="" src="http://2.bp.blogspot.com/_ngczZkrw340/Shz7oLxXLGI/AAAAAAAAOEU/DwxV6QUYuKU/s400/france+consumer+confidence.png" border="0" //abr /br /French consumer spending increased in April as government incentives boosted car sales and slowing inflation helped cushion ...

Well the eurozone outlook is certainly deteriorating less rapidly at this point, as attested to in the May flash PMIs - which show the pace of economic contraction slowing markedly. Purchasing managers’ indices for the 16-country euro area jumped rose significantly this month, and hit their highest level for eight months. It is important to bear in mind that the index still registered contracting economic activity, but the rate of decline fell for a third consecutive month. Chris Williamson, chief economist at Markit, which compiles the purchasing managers’ indices, said the latest readings were consistent with second quarter GDP falling about 0.5 per cent quarter on quarter, or by a 2% annual rate, well down from the 2.5% quarter on quarter reading (or 10% annual rate) registered in the first three months. Still, we are still in the realm of contraction, and Organisations such as the International Monetary Fund, the ...

The Bloomberg Euro-Zone Retail Purchasing Managers' Index - based on a mid-month survey of more than 1,000 executives in the euro area retail sector - rose marginally in March - to 44.1, up from 42.3 in February to 44.1 in March. This was the smallest monthly drop in the value of sales in five months, but it was still a drop, and quite a significant one, since the neutral point between contraction and expansion is 50. Still first quarter retail sales have seen an average monthly decline which is smaller than in the fourth quarter of last year (an effect of all those stimulus programmes), however sales have now fallen for ten consecutive months.br /br /strongThe German Sales Contraction Acceleratesbr //strongbr /Retail sales in Germany, the zone's largest economy, dropped for a 10th month in March as unemployment rose and manufacturing industry continued to grapple with a slump in export ...

blockquoteIt’s a depressing spectacle: on both sides of the Atlantic, policy-makers just keep falling short — and the odds that this slump really will turn into Great Depression II keep rising.br /br /In Europe, leaders rejected pleas for a comprehensive rescue plan for troubled East European economies, promising instead to provide “case-by-case” support. That means a slow dribble of funds, with no chance of reversing the downward spiral.br /br /Oh, and Jean-Claude Trichet says that there is no deflation threat in Europe. What’s the weather like on his planet?br /a href="http://krugman.blogs.nytimes.com/2009/03/02/failing-the-test/"Paul Krugman, yesterday/a/blockquotebr /br /What follows here are simply a few charts to illustrate further a href="http://fistfulofeuros.net/afoe/economics-and-demography/there-is-no-deflation-threat-in-europe-jean-claude-trichet-oh-really/"the argument I developed yesterday/a as regards the significance of the deflation threat which now exists in the eurozone. The argument is that the ECB is once again being far too cautious, and risks allowing the entire eurozone to entire a deflationary cycle which ...

He's at it again. Last year he was busily trying to worry us all that inflation was set to get completely out of hand among the 16 countries who make up the eurozone. Now the President of the European Central Bank, Jean-Claude Trichet, is hard at it on another tack and a href="http://www.reuters.com/article/bondsNews/idUSLL48440320090121?sp=true"is busying himself trying to convince us/a that there is no credible deflation threat facing these countries. Apart from getting it wrong on both occasions, the common point here would be a certain inbuilt "inflation bias", a bias which was earlier called "the original sin of the Bundesbank" by nobel prize winning Italian economist Franco Modigliani.br /br /blockquote"There is presently no threat of deflation," Trichet told a committee of the European Parliament on Wednesday 14 February. "We are currently witnessing is a process of disinflation, driven in particular by a sharp decline in commodity prices." ..."It is a ...