It looks like someone linked you here to our printer friendly page. Please make sure you go Back to Safehaven.com for more great articles just like this one!

Eurozone: Back in Technical Recession, Economist Poll Results

By: Ian Campbell | Friday, November 16, 2012

A poll of over 70 economists is reported as saying the Eurozone's just announced (yesterday) return to technical recession (two consecutive quarters of declining GDP) will extend to the end of 2012, with 2013 likely to be a 'little better than stagnation' scenario.

The poll also found that a 'firm majority' of all poll respondents think Spain will seek financial aid, and that of 28 respondents who answered a question as to the likely timing of that:

I suggest you think very hard about how at least 20 of those 28 economists seem to be assessing what is going on in the Eurozone and its near-term and longer-term prospects.

It seems inevitable to me that Spain will seek financial aid. It also seems to me to be a certainty that the longer Spain waits to seek financial assistance, the poorer will be its economic prospects at the time it does that. Spain is an important Eurozone economy, being its fourth largest (of 17 Eurozone countries) after Germany, France and Italy. The weaker Spain's economy at the time it seeks financial aid, the worse off will be the entire Eurozone economy - at least as I see things. Accordingly, for 20 of 28 economists to think Spain won't seek financial aid until sometime in 2013, or not at all, for me seems to be at odds with the proposition that the Eurozone total economy will maintain a 'stagnation' posture without further deterioration in 2013.

You might also want to read Eurozone falls into second recession since 2009. I find it hard to believe that every economist who was polled has not been predicting for months a return to technical recession for the Eurozone.

Topical References: As Europe slips back into recession, little hope for brighter 2013: poll, from The Financial Post, from Reuters, November 15, 2012 - reading time 3 minutes. Also read Eurozone falls into second recession since 2009, from The Financial Post, from Reuters, Robin Emmott and Michelle Martin, November 15, 2012 - reading time 3 minutes.

 

Author: Ian Campbell

Ian R. Campbell, FCA, FCBV
Economic Straight Talk

Through the Economic Straight Talk Newsletter Ian R. Campbell shares his perspective on the world economy, the financial markets, and natural resources. A recognized business valuation authority, he founded Toronto based Campbell Valuation Partners (1976), Stock Research Portal (2007) a source of resource companies market data and analytic tools, and Economic Straight Talk (2012). The CICBV* annually funds business valuation research in his name**. Contact him at icampbell@srddi.com.
* Canadian Institute of Chartered Business Valuators
** through The Ian R. Campbell Research Initiative

The full version of The Economic Straight Talk Newsletter is published each trading day. To get your Free 14-day trial subscription, visit economicstraighttalk.com. No obligation or credit card required.

Informed Investors are Successful Investors

Comments and opinions expressed in these commentaries are those of the authors. They do not constitute individualized investment advice, are provided "as is", may change without prior notice, and are used at your own risk. The information and content provided or referenced may be incomplete, inexact, or incorrect. Your use of these commentaries is subject to the Economic Straight Talk Terms of Use and Legal Disclaimer

Copyright © 2011-2013, Stock Research DD Inc., all rights reserved