Germany's Government Confirms Second Year of Recession | DW News

Oct 9, 2024 | The German government has updated its growth forecast for the country’s economy. It is now expecting GDP to drop 0.2 percent for this year, making it the second year in a row with a shrinking economy. We’re talking to ING chief economist Carsten Brzeski about the reasons for Germany’s weakness, how the country stacks up compared to other economic superpowers – and what the future will hold.

Eurozone Sinks into Recession as Cost of Living Crisis Takes Toll

THE GUARDIAN: GDP shrank 0.1% in first quarter of 2023 and final three months of 2022 after revisions to earlier estimates

The eurozone slipped into recession in the first three months of the year, after official figures were revised to show the bloc’s economy shrank as the rising cost of living weighed on consumer spending.

Figures from Eurostat, the EU’s statistical agency, showed gross domestic product (GDP) fell by 0.1% in the first quarter of 2023 and the final three months of 2022 after revisions to earlier estimates. A technical recession is generally defined as two consecutive quarters of negative growth. » | Richard Partington, Economics correspondent | Thursday, June 8, 2023

UK Prepares for Recession amid Rising Interest Rates

May 26, 2023 | Owning a home is getting more expensive as lenders begin putting up mortgage rates, spooked by stubbornly high inflation figures.

UK Heads for Long Recession as Economy Shrinks by 0.2%

THE GUARDIAN: ONS figures for three months to September give bleak picture in run-up to chancellor’s autumn statement

Britain’s economy shrank by 0.2% in the three months to September, in what is expected to be the beginning of a long recession.

In its first estimate of growth in the third quarter, the Office for National Statistics (ONS) presented a bleak picture of the economy before next week’s autumn statement from the chancellor, Jeremy Hunt.

Activity in the service sector ground to a halt, with zero growth over the quarter, driven by a fall in consumer spending as households came under mounting pressure from the cost of living crisis.

Growth in the construction sector slowed, while factory output slumped because of a sharp decline in manufacturing as some businesses continued to struggle with supply chain difficulties and shortages of key materials. » | Larry Elliott and Richard Partington | Friday, November 11, 2022

Europe Braces for Recession as Economies Falter: Britain’s economic output fell in the third quarter and European Union officials forecast weakening growth for countries across the continent. »

Economy Latest: Interest Rates Up as Bank of England Warns of Long Recession

Nov 3, 2022 | People are already struggling with soaring costs and a tax burden, the highest since World War Two.

Forecast by the IMF Shows Germany and Italy Are to Tumble into Recession in 2023 | Business Special

More German Businesses Go Bankrupt amid Weak Economy, High Inflation | DW News

A sharp uptick in the number of German firms beginning insolvency proceedings is raising eyebrows in Europe's largest economy. Some 762 firms declared bankruptcy in September — a 34% increase from the same period last year.

And the upward-trend is set to continue this month and the next, according to the Halle Institute for Economic Research. Its new report suggests that by November up to 40% more companies could be beginning insolvency proceedings, compared to the same period last year.

UK in Recession and Further Interest Rate Hikes on Their Way, Bank Warns Kwarteng

THE GUARDIAN: Threadneedle Street makes clear on eve of tax-cutting mini-budget that plans risk triggering more rate rises

One Whitehall source described the chancellor’s mini-budget as having ‘more rabbits than Watership Down’. Photograph: Toby Melville/Reuters
The Bank of England has warned Kwasi Kwarteng the economy is in recession and it will most probably need to push interest rates higher following Friday’s tax-cutting mini budget from the chancellor.

On the eve of a major package of support from the chancellor designed to break what he called the economy’s “cycle of stagnation”, Threadneedle Street said the UK economy was heading for a second consecutive quarter of falling output, with gross domestic product set to shrink 0.1% in the three months to September.

However, with energy and food bills still soaring, and inflation not expected to peak until October, the Bank of England raised the cost of borrowing for a seventh successive meeting of its monetary policy committee (MPC) and made clear the new government’s plans risked triggering more interest rate hikes. » | Larry Elliott, Jessica Elgot and Richard Partington | Thursday, September 22, 2022

Pound Falls as Weak Retail Sales Raise Fears UK Economy Is in Recession

THE GUARDIAN: Sterling drops by more than 1% against dollar to $1.1351, its lowest since 1985

The pound sank to a fresh 37-year low against the dollar on Friday after weaker than expected retail sales raised fears that the British economy is already in recession.

Sterling fell by more than 1% against the currency to $1.1351, its lowest since 1985, partly reflecting broader dollar strength as well as specific concerns about the outlook for Britain. The pound also hit a 17-month low against the euro, with €1 worth 87.66p.

It came as the latest official data showed cash-strapped consumers cut back on spending by more than expected in August, when retail sales volumes in Great Britain fell by 1.6%. Economists had predicted a more modest fall of 0.5%. » | Phillip Inman | Friday, September 16, 2022

The Brexit pound is looking pretty weak and pathetic, isn't it? Never mind! We've got our blue passports back now; so you'll be able to sleep better at night.

Brexit, of course, is not the cause of this recession, but it sure isn't helping any. Gee thanks, Farage! And all your stupid, selfish cohorts. But hey! You'll be sitting pretty even if so many Brits will have to starve and/or freeze to death this winter. In German, we would call the lot of you ein Lumpenpack! Go look it up, Nige (et al), it suits you dorks to a T. – © Mark Alexander

Worst Economic Prediction for a Generation - as UK Heads for Recession

Elon Musk Says a US Recession Is ‘Inevitable’

THE GUARDIAN: Tesla CEO says slump is likely to come in near term, amid plan to lay off 10% of firm’s salaried staff

Elon Musk, the world’s richest man, says a US recession is ‘more likely than not in the near term’.Photograph: Joe Skipper/Reuters
Elon Musk has warned that a US recession is “more likely than not” as the Tesla chief executive confirmed plans to cut 10% of salaried staff at the electric carmaker over the next three months.

The world’s richest man said a recession in the US was inevitable but would most probably come in the short term.

“A recession is inevitable at some point. As to whether there is a recession in the near term, that is more likely than not,” Musk said in an interview via videolink at the Qatar Economic Forum in Doha on Tuesday.

Musk said Tesla was planning to reduce salaried staff numbers by 10%, confirming plans revealed in an internal email this month by Reuters. » | Dan Milmo and agency | Tuesday, June 21, 2022

US Stocks Worst Day since 2020 amid Recession Worries

THE GUARDIAN: Recession fears are swirling through the markets again, as rising inflation and snarled supply chains hit economies, driving up the cost of living and hitting some company profits.

Last night, US stocks posted the biggest daily drop in almost two years, on concerns that economic growth will falter as central bankers look to raise interest rates to stem the surge in inflation.

Fed chair Jerome Powell’s determination to keep lifting borrowing costs until inflation falls meaningfully has rattled Wall Street, and is likely to push European markets lower today too.

The S&P500 fell more than 4% lower yesterday, Nasdaq slumped more than 5% and the Dow slid more than 3.5%. » | Graeme Wearden | Thursday, May 19, 2022

Recession: The Price Britain Will Pay to Control Inflation

THE GUARDIAN: Analysis: As the Bank of England raises interest rates the message is clear – the 1970s are back

Unemployment rising. Inflation above 10%. Energy prices soaring. Living standards squeezed. The message from the Bank of England was crystal clear: the 1970s are back.

The word stagflation was not to be found in the 100-plus pages of Threadneedle Street’s monetary policy report. Yet a period of weak growth and rapidly rising prices is precisely what the Bank says is in store for the UK. The current post-lockdown bounce will be short-lived and, in a real blast from the past, the economy will be driven into recession to bring inflation under control.

Nor is the pain likely to be over quickly. The economy is expected to contract by 0.25% in 2023 and remain weak in the next two years. Unless things take a marked turn for the better, the next general election will take place against a backdrop of weak growth and lengthening dole queues. » | Larry Elliot, Economics editor | Thursday, May 5, 2022

Bank of England raises interest rates as it warns of recession and 10% inflation: Rise to 1% is fourth successive increase and highest level since February 2009 »

Related.

Recession Is a Good Time to Exploit Cheap Labour, Says Cameron Aide
THE OBSERVER: Lord Young says low-wage conditions are a bonus for business, drawing a furious response from the TUC

The prime minister's adviser on enterprise has told the cabinet that the economic downturn is an excellent time for new businesses to boost profits and grow because labour is cheap, the Observer can reveal.

Lord Young, a cabinet minister under the late Baroness Thatcher, who is the only aide with his own office in Downing Street, told ministers that the low wage levels in a recession made larger financial returns easier to achieve. His comments are contained in a report to be published this week, on which the cabinet was briefed last Tuesday.

Young, who has already been forced to resign from his position once before for downplaying the impact of the recession on people, writes: "The rise in the number of businesses in recent years shows that a recession can be an excellent time to start a business.

"Competitors who fall by the wayside enable well-run firms to expand and increase market share. Factors of production such as premises and labour can be cheaper and higher quality, meaning that return on investment can be greater."

A Downing Street spokesman said Young was merely stating a "factual point and nothing else". But the comments were described as "appalling and ill-timed" by union leaders, with job-market figures due out next week expected to show that the initial resilience of employment has faded while wages are being severely tightened. » | Daniel Boffey, policy editor | Saturday, May 11, 2013

Global Crisis Moves East as China Suffers Rapid Downturn

THE DAILY TELEGRAPH: China’s industrial output is contracting at the fastest pace since the depths of the global financial crisis, with knock-on effects spreading across the Far East.

“It just keeps getting worse,” said Alistair Thornton and Xianfang Ren from IHS Global Insight. “The government has underestimated the pace of the slowdown and is behind the curve.”

The HSBC/Markit manufacturing index for China fell to 47.6 in August, the lowest since the onset of Great Recession in late 2008. Inventories are rising. The index for new export orders fell to the lowest since March 2009. “Beijing must step up policy easing to stabilise growth,” said Hongbin Qu from HSBC.

China’s official PMI manufacturing index – weighted to big companies – also fell through the contraction line of 50, though services are holding up better.

Evidence of a hard landing over the summer is becoming clearer. Rail volumes fell 8.2pc in July from a year before. The Japanese group Komatsu said its exports of hydraulic excavators to China – a proxy gauge for Chinese construction – fell 48pc in August from a year before.

The twin effect of China’s downturn and Europe’s double-dip recession has turned into a full-blown shock for much of Asia. Hong Kong and Singapore both contracted in the second quarter and are probably in technical recession. Read on and comment » | Ambrose Evans-Pritchard | Monday, September 03, 2012

UK Economy Shrinks 0.5pc
THE DAILY TELEGRAPH: Britain's economy shrank unexpectedly in the final three months of last year as heavy snow compounded a slowdown in growth.

Gross domestic product fell 0.5pc in the fourth quarter, the most in more than a year, the Office for National Statistics reported on Tuesday. The decline compared with growth of 0.7pc in the third quarter.

George Osborne insisted that the Government will press ahead with planned cuts to public spending, despite warnings from forecasters that the economy may be too weak to withstand the package.

Blaming the growth figures on the cold weather, Mr Osborne maintained that a weakening in efforts to tackle the deficit would pose a greater bigger threat to the nation's future prosperity.

"There is no question of changing a fiscal plan that has established international credibility on the back of one very cold month. That would plunge Britain back into a financial crisis," the Chancellor said.

"We will not be blown off course by bad weather." Read on and comment >>> | Tuesday, January 25, 2011

USA: Fears Over Economy Highest Since Recession
MAIL ONLINE: The number of Americans worried about the economy has reached its highest level since the darkest days of the recession two years ago, according to a new survey published today.

The Rasmussen poll showed that 87% of voters view the economy as by far the most important issue facing the government.

The percentage is five points up from an October poll and underlines the task still faced by President Obama to restore confidence in the shell-shocked financial system.

Improving the economy is seen as the highest priority since August 2008, when the scale of the financial crisis was first becoming clear.

Only 24% of voters agree with Mr Obama’s claims that his policies have the economy moving in the right direction. However, halfway into the Obama presidency more voters still believe the Bush White House was more to blame for the financial collapse than the current administration. Welcome home, Mr President: Poll reveals fears over economy at highest level since recession as Obamas return from Hawaii
>>> David Gardner | Wednesday, January 05, 2011

Bankers Party Like Recession Never Happened
SKY NEWS: Over 1000 bankers have been quaffing champagne like the recession never happened at the largest City party since the economic crash of 2007.

The New Poor: Blacks in Memphis Lose Decades of Economic Gains
THE NEW YORK TIMES: MEMPHIS — For two decades, Tyrone Banks was one of many African-Americans who saw his economic prospects brightening in this Mississippi River city.

A single father, he worked for FedEx and also as a custodian, built a handsome brick home, had a retirement account and put his eldest daughter through college.

Then the Great Recession rolled in like a fog bank. He refinanced his mortgage at a rate that adjusted sharply upward, and afterward he lost one of his jobs. Now Mr. Banks faces bankruptcy and foreclosure.

“I’m going to tell you the deal, plain-spoken: I’m a black man from the projects and I clean toilets and mop up for a living,” said Mr. Banks, a trim man who looks at least a decade younger than his 50 years. “I’m proud of what I’ve accomplished. But my whole life is backfiring.”

Not so long ago, Memphis, a city where a majority of the residents are black, was a symbol of a South where racial history no longer tightly constrained the choices of a rising black working and middle class. Now this city epitomizes something more grim: How rising unemployment and growing foreclosures in the recession have combined to destroy black wealth and income and erase two decades of slow progress. >>> Michael Powell | Sunday, May 30, 2010

Recession’s Toll on Black Wealth in Pictures >>>

The Americans Have Lost Their Way
Rep. Paul Ryan, shown here in March, has proposed reductions in future Medicare and Social Security benefits for people under 55, a politically difficult idea. Photo: USA Today
USA TODAY: WASHINGTON — Erskine Bowles realized how tough his task will be leading President Obama's war on the federal budget deficit when he told his 90-year-old mother of his appointment.

She was proud of him. Then she said, "Don't mess with my Medicare."

It won't be the last threat Bowles gets this year as he directs an 18-member, bipartisan commission through an ocean of red ink that has never been deeper or more foreboding.

Under Obama's budget plan, the USA's debt in 2020 would be nearly the size of the entire economy then. Interest costs would be $900 billion, five times today's level.

The White House, Congress, budget experts and typical Americans are growing anxious about the nation's mounting debt, which is helping to fuel the rise of the anti-tax, anti-big government Tea Party movement.

Yet the only solutions capable of raising enough money are politically dangerous for the president and Congress: tax increases and major reductions in Medicare, Medicaid and Social Security.

Neither Democrats nor Republicans want to take the first step.

The debt hasn't stopped conservatives from saying tax increases should be off the table when the panel debates how to close Washington's budget gap — an estimated $1.5 trillion this year alone, equal to the entire federal budget in 1995. Nor has it stopped liberals from saying Medicare, Social Security and other entitlements must be protected.

Bowles, outgoing president of the University of North Carolina and a White House chief of staff under Bill Clinton, says neither taxes nor benefits can be off-limits.

"We can't do this without a lot of pain," he says. Nation's soaring deficit calls for painful choices >>> Richard Wolf, USA Today | Tuesday, April 13, 2010