[BrianC]

Germany Falls Into Recession as Consumers in Europe's Biggest Economy Spend Less
Germany has slipped into recession as last year's energy price shock takes its toll on consumer spending. From a report:
Output in Europe's largest economy dropped 0.3% in the first three months of the year, following a 0.5% contraction at the end of 2022, official data showed Thursday. The Federal Statistical Office downgraded its previous estimate of zero growth in gross domestic product (GDP) compared with the previous quarter. A recession is defined as two consecutive quarters of declining output.

"The persistence of high price increases continued to be a burden on the German economy at the start of the year," the office said. "This was particularly reflected in household final consumption expenditure, which was down 1.2% in the first quarter of 2023." Claus Vistesen, chief euro area economist at Pantheon Macroeconomics, said spending by consumers in the first quarter was crimped by "the shock in energy prices."
https://edition.cnn.com/2023/05/25/econ ... index.html

[Plantagenet]

Germany slipping into recession may just be the beginning. I can't see Germany going into recession without other EU states being pulled into recession....and I can't the see EU going into recession without the US and China going into a recession.

In fact I think we are heading into a GLOBAL RECESSION......

On the bright side, this doesn't mean that global stock markets are going to necessarily collapse.

Germany just went into recession but the German DAX stockmarket is near all time highs.

In this era of high inflation and economic stagflation where cash loses its value every day, there aren't many places other then the stock market where you can put your money in order to keep up with inflation.



Cheers!

[theluckycountry]

In fact I think we are heading into a GLOBAL RECESSION......

On the bright side, this doesn't mean that global stock markets are going to necessarily collapse.

Of course not. For a global collapse like the GFC to happen we would need to see a hedge fund and an insurance company go under...

[careinke]

Germany should just change the definition of Recession, just like the U.S. did. Problem solved!!

Peace.

[theluckycountry]

"Migrants Will Soon Be The Powerful" - German Broadsheet Causes Uproar With Immigration Article

https://www.zerohedge.com/geopolitical/ ... on-article

Perhaps the museums will manage the nation better. The Fuhrer must be rolling in his bunker.

[theluckycountry]

The latest is "Eurozone sinks into recession as cost of living crisis takes toll"
https://www.theguardian.com/business/20 ... takes-toll

But what does "consecutive quarters of decline" mean anyway when you can manipulate the GDP by including stock transactions, home loans, or any other financial transaction you deem are domestic profit? There is no reality to these pronouncements, hasn't been for decades. I remember when the debt binge really took off here in the 1980's and banks began putting up little signs touting their "Products". That seemed stupid to me but it was when we shifted to adding mortgage loans to GDP to get the economic numbers to look better.

It has been said that market finance and national currencies are simply a confidence game, and it's true. The people of the EU have been losing their standard of living since the 1970's, but slowly, like the frog in the pot of warming water. If you had a job and could borrow you never noticed this, but if you were retired on a state pension you experienced it it more and more with each passing year. Forty years ago a couple retired on a pension could afford to eat steak, maintain their home, drive a well maintained car and upgrade it when needed. Not now! It went from steak to mince to chicken and cheap pork. The house maintenance is prohibitive and their cars are worn out and worthless. I see this clearly in Australia, a rich nation. I can only wonder what it's like for the poor in the Euro zone.

Total Wars typically sort these problems out. They cancel all the debts and you can rebuild with a smaller population. The last world war was unique because its end coincided with the glory days of the oil age. Unlimited cheap energy to rebuild, to innovate, to expand. Now we have a world filled with aging infrastructure and no cheap oil to replace it. We have unassailable mountains of debt and untold trillions of retirement promises in digital accounts, under which are listed companies that are totally dependent on cheap oil.

We have seen recessions before, but remember, that is just a word, a word used by governments to explain why people are going hungry and can't heat their homes. There used to be another word in common use, Depression. Depression though was deemed too "Depressing" so it was abandoned. But what was also abandoned was the process by which companies and economies were allowed to quickly restructure and move forward. Companies and banks were allowed to collapse and while some suffered, the greater economy would bounce back in a year or two.

Today governments paper over these problems and use debt to patch up the companies and economy. It's like putting a bandage over a festering wound without cleaning it first, it simply hides the problem. Then when the wound purifies and the pus leaks out so they wrap another clean bandage over it. Where does this lead? The amputation of the limb of course, or the death of the body. In the economic sense it leads to a true depression, something the likes of which has probably never been recorded. Two things are certain though, Europe is totally dependent on fossil fuels to maintain it's prosperity, and the production of those fossil fuels is in decline, they are becoming too expensive relative to their ability to pay.

[AdamB]

Two things are certain though, Europe is totally dependent on fossil fuels to maintain it's prosperity, and the production of those fossil fuels is in decline(1), they are becoming too expensive relative to their ability to pay (2).

(1) Proof of nonsense from POB. When peak oilers can prove you wrong, you know you really are on the bottom of the credibility pile.

(2) Inflation adjusted oil price from the Fed demonstrating current low oil prices and crap Aussie knowledge on topic. As expected. And as usual.