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20 Signs That Europe Is Plunging Into A Full-Blown Economic Depression

An economic nightmare is descending on Europe.  With each passing month, the economic numbers across Europe get even worse.  At this point it is becoming extremely difficult for anyone to deny that Europe is plunging into a full-blown economic depression.  In fact, some parts of Europe are already there.  In Spain the overall unemployment rate is over 22 percent, and in Greece one out of every five retail establishments has already been closed down.  All over Europe, economic activity is rapidly slowing down, unemployment is skyrocketing and bad debts are unraveling.  It isn’t even going to take a default by a nation such as Greece or a collapse of the euro to push Europe into an economic depression.  All Europe has to do is to stay on the exact path that it is on right now and it will get there.  Normally, European governments would respond to an economic slowdown by increasing government spending.  But this time most of them are already drowning in debt.  Instead of increasing government spending, most governments in Europe are actually cutting back.  All over Europe, national governments are being encouraged to implement even more tax increases and even more budget cuts.  The hope is that all of this austerity will help solve the nightmarish sovereign debt crisis that Europe is facing.  But unfortunately, all of these tax increases and budget cuts are also going to involve a tremendous amount of economic pain.

The frightening thing is that we are just at the beginning of the process for most European nations.  If you want to see where nations such as Portugal, Italy and Spain are headed, just take a look at Greece.  Greece has been going down this road for several years, and there is still no light at the end of the tunnel for them.

The tax increases and budget cuts that are being implemented right now in Europe will be felt for years to come.  The tremendous economic prosperity that was fueled by unprecedented amounts of debt will now give way to tremendous economic suffering.

The following are 20 signs that Europe is plunging into a full-blown economic depression….

#1 The unemployment rate for those between the ages of 16 and 24 is 28 percent in Italy, 43 percent in Greece and 51 percent in Spain.

#2 Overall, the unemployment rate for those under the age of 25 in the EU is 22.7 percent.

#3 Citigroup is projecting that the economy of Portugal will shrink by 5.7 percent this year.

#4 The total of all forms of debt in Portugal (government, business and consumer) is equivalent to 360 percent of GDP.

#5 The Greek “recession” is now entering a fifth year.

#6 The Greek economy shrank by 6 percent during 2011.

#7 It is being projected that the Greek economy will shrink by another 5 percent during 2012.

#8 The overall unemployment rate in Greece is now 18.5 percent.

#9 In Greece, 20 percent of all retail stores have been permanently shut down.

#10 The number of suicides in Greece rose by 40 percent in just one recent 12 month time period.

#11 According to the IMF, the amount of debt accumulated by the Greek government is equal to approximately 160 percent of GDP.

#12 In total, there are now more than 5 million unemployed workers in Spain.

#13 Bad loans in Spain recently reached a 17-year high.

#14 The overall unemployment rate in Spain is now a whopping 22.8 percent.

#15 The number of property repossessions in Spain has risen by 32 percent over the past year.

#16 When the maturing debt that the Italian government must roll over in 2012 is added to their projected budget deficit, the total comes to approximately 23.1 percent of Italy’s GDP.

#17 Manufacturing activity in the euro zone has fallen for five months in a row.

#18 The UK economy actually contracted during the 4th quarter of 2011.

#19 The German economy actually contracted during the 4th quarter of 2011.

#20 The Baltic Dry Index, often used as a gauge for the health of the world economy, has fallen a staggering 61 percent since October.

Economic gloom is slowly spreading throughout Europe like a dark cloud.  Some of the strongest economies in Europe are only just starting to slow down.  Others are already gripped by tremendous economic pain.  Trends forecaster Gerald Celente recently explained to ABC Australia that much of the EU is already experiencing an economic depression….

“If you live in Greece, you’re in a depression; if you live in Spain, you’re in a depression; if you live in Portugal or Ireland, you’re in a depression,” Celente said. “If you live in Lithuania, you’re running to the bank to get your money out of the bank as the bank runs go on. It’s a depression. Hungary, there’s a depression, and much of Eastern Europe, Romania, Bulgaria. And there are a lot of depressions going on [already].”

As things fall apart in Europe, the political wrangling is going to become even more intense.

For example, over the past few days a shocking new German proposal has come to light.  Germany apparently would like Greece to give a “EU budget commissioner” the power to veto all Greek decisions on taxes and spending.

That would represent an unprecedented loss of sovereignty for Greece, and obviously Greek politicians are not excited about the idea at all.

In fact, Greek education minister Anna Diamantopoulou said that the proposal was “the product of a sick imagination“.

But the sentiment in Germany is that since Greece must be bailed out by them, Greece should be willing to submit to some oversight for a certain amount of time.

It will be interesting to see how this plays out.

Meanwhile, the Greek people continue to become angrier.  According to one recent poll, about 90 percent all of Greek citizens are unhappy with the interim government led by Prime Minister Lucas Papademos.

Things are also unraveling very quickly in Portugal.  Now there is talk that private investors will be required to take a “haircut” on Portuguese debt as well.

The following is from a recent article in the Telegraph….

A report for the Kiel Institute for the World Economy said Portugal would have to run a primary budget surplus of over 11pc of GDP a year to prevent debt dynamics spiralling out of control, even in a benign scenario of 2pc annual growth.

“Portugal’s debt is unsustainable. That is the only possible conclusion,” said David Bencek, the co-author, warning that no country can achieve a primary budget surplus above 5pc for long.

“We won’t know what the trigger will be but once there is a decision on Greece people are going to start looking closely and realise that Portugal is the same position as Greece was a year ago.”

Sadly, that article is exactly right.

Portugal is marching down the exact same road that Greece went down.

The yield on 5 year Portuguese bonds is now up to an all-time record 19.8 percent.

A year ago, the yield on those bonds was only about 6 percent.

This is the same thing that happened to Greece.

A year ago, the yield on 5 year Greek bonds was about 12 percent.

Now the yield on those bonds is more than 50 percent.

The world is facing a debt crisis unlike anything ever seen before, and Europe is right at the center of it.

Right now, the major industrialized nations of the world are 55 trillion dollars in debt.

Everyone knew that at some point that debt bomb was going to explode.

So what is going to happen next?

Well, Europe appears to be heading for a full-blown economic depression.

Will the rest of the globe be able to escape a similar fate?

  • Ivan

    What’s gonna happen next is that we’re headed for another period very similar to 1930-1945, with perhaps a NWO at the end of it. Get ready.

    • Guido

      It’s the 4th Turning. Nothing is new under the sun.

  • Kelly B

    Possibly America in the coming years?

  • Cyk

    The reason why regions fall into a depression is
    because they are talked into it.

    And they are talked into it, because the ones that control the media want to profit from the
    depression.

    • Wendy Davis

      We are seeing history repeat itself. This is not a figment of our imagination or a fear come to realization through our own actions. There have been 3 depressions in USA and they all were preceded by a credit (money) expansion (loans to everyone) and a money (loan) contraction. The bubble was the stock market before. The dollar will collapse when it is no longer used as universal currency, and as before, stock market will fall as investors flee US. The dollar bubble bursting will be what sends every American into poverty; it will be worthless. IMO

      Bubbles are created to transfer wealth. When value of assets fall, due to the loss of demand, they are gobbled up by the wealthy and investors at bottom dollar, further crippling the value of assets. This is very real. It is by design.

    • Guido

      I don’t think so. Depressions happen as the result of colossal mismanagement and meddling by government and an overabundance of credit. Look at the 1930s. No one knew the day before the market tanked their economy was in trouble. No one had any reason to believe there was trouble around the corner.

  • Mainuh1

    What is going to happen next? WAR!!!

  • ScoutMotto

    I’ve heard too much about how this same fate is *planned* for the US.

    The US is in a grace period. Keep on prepping, and keep on the precious metals while they are obtainable.

  • Ameen

    @Richard Bryant: unfortunately, this article is right ON! I follow this stuff independently, and every detail is right on the mark. And yes, we ARE in for a very rough ride ahead…

  • mondobeyondo

    Just another chapter in the ongoing saga that is “My Big Fat Greek Economic Meltdown”.

    Okay, so Greece gets bailed out by some miracle. All loans are debt. (Repeat after me: “All loans are debt”.) You think you are getting money, and maybe some temporary relief, but remember, you have to pay your lender back – with interest!! (Proverbs 22:7). That’s true for you and your credit card, and it’s just as true for nations and the banking system.

    Greece gets a loan from the IMF. But here’s the kicker – you can’t get a loan without interest!!!

    So Greece gets a $50 billion loan from the IMF or whatever. But they stick a 8% interest rate to the loan. That’s being conservative. Let’s try 20%.

    Short term relief, long term misery! For Greece not only has to pay the principal back, but also the interest!! The end result would be, Greece would be even FARTHER in debt than they were before!! How would they pay the full amount of the loan? Let’s see.. No retirement benefits for anyone, for starters. Hmmm, what else? How much do you want for the Acropolis? Is $35 billion enough? Hey, come on, it’s an ancient historical site, it’s worth the price!

    Yeah, I know, you Greek citizens worked hard for 40 years saving for retirement. You counted on that money to support you during your “golden years”. Well guess what? The government is taking your retirement savings, and those of every Greek citizen! And everything else you have. And we’re selling the Parthenon, too! (Still won’t be enough.)

    Don’t laugh. The USA is headed in the same direction.
    ————————-
    On the serious side…

    Remember the last time Europe was in an economic depression?

    Some guy named Hitler came out of the shadows, and promised economic recovery for Germany. Another guy named Mussolini promised economic recovery for Italy. He even said he’d make the trains run on time.

    We are heading for scary, scary times.

    • BenjiK

      Yet another loan to Greece by the IMF is akin to paying your minimum payment on your maxed-out Visa card with your almost-maxed out Master-Card. You are absolutely correct, let’s just look at it for what it is: An IMF “loan” to pay a portion of other loans that Greece can’t pay. No matter how you break it down, in the end it spells financial DISASTER.

    • Guido

      Yes sir. Mondo, you are always a voice of reason in a stupid world.
      Read Confessions of an Economic Hit Man. The author explains how he was a tool of the IMF and World Bank to force loans on poor nations who would never be able to repay them in order to put them so far in debt that they would have to do whatever the US told them to do. It is just like the 19th century company town format writ large.

  • mondobeyondo

    “#11 According to the IMF, the amount of debt accumulated by the Greek government is equal to approximately 160 percent of GDP.”

    Whenever your debt exceeds your GDP, you are in deep poo. You are in a hole that will be extremely difficult to climb out of. In other words, your country – (or household, or business), cannot produce enough goods or services, to equal or exceed the debt that you owe. That’s not good, to say the least. Take the freeway to Bankruptcy Court, or if you are a sovereign nation, just default and beg for mercy.

    Danger, Will Robinson, Danger!

  • REED RICHARDS

    UNTIL THE IDIOT MASSES IN EUROPE AND AROUND THE WORLD STOP VOTING FOR THE WARFARE, POLICE, AND WELFARE STATES THEN THEY WILL CONTINUE TO GET WHAT THEY DESERVE:

    Suckers one and all. There is no debt crisis. There are only speculative bets by bankers and other assorted criminals (politicians, corporate ceos, killers for hire, etc.) If only the masses knew what to do all of this could end virtually overnight. What to do? Remove from power all those that are enslaving them at the ballot box. If mass populations had the presence of mind and the force of intellect to vote for their social, economic, and political interests instead of childishly saying “I want to vote for the candidate that can, or I don’t want to “waste my vote” etc.” then perhaps they can get the changes in government that they claim they want.

    • mark

      Sorry Reed, you always say that the voters can change things if they would just vote for the right guy. Well, they will not vote for the right guy because many are just plain stupid. I also understand that theme is part of your statement. They would rather just get by on welfare than earn a good living and make something of themselves. That is called hard work and for many here in the US, that is just too hard. This is why we need strict term limits of one term in the house in your lifetime and then go home. And while we are at it let’s have a part time congress, with less time in Washington, the congress can’t pass so many laws that we do not need.

      • REED RICHARDS

        mark,

        If you have read any other postings I have made I have also made that same observation. From CEOs on down virtually no one wants to operate a legitimate business or hold jobs that require hard work as well as independent thought. We live in a society where most want something for nothing and the CEO types only want to operate casinos for gambling gargantuan sums of printed out of thin air money rather than build any industrial capacity. It’s like I always say, I have no sympathy for people whose wounds are self inflicted………………

    • http://endoftheamericandream.com/archives/20-signs-that-europe-is-plunging-into-a-full-blown-economic-depression STEVE

      Amen, Richard!! Spot on right!!

      • http://endoftheamericandream.com/archives/20-signs-that-europe-is-plunging-into-a-full-blown-economic-depression STEVE

        ….excuse me, “Reed.” Great analysis…

  • michelle

    clif has a new report out at halfpasthuman.com

  • William

    All neatly arranged by the criminal bankster trash of Wall St and the City of London. Sadly, this will roll across the Atlantic to hit America, which has been severly damaged by the removal of the Glass-Steagall firewall between commercial banking and investment banking. Thanks to IDIOT former US Senator Gramm of Texas and Clintoooon!!

    • REED RICHARDS

      William,

      Thanks to the rightwing war party idiots who voted for Phil Gramm………….

  • deadby2020

    “If your not out there hustling everyday, your not going to make it”….Mike Wolf, American Pickers

  • REED RICHARDS

    William,

    And the democrat war party idiots who voted or Billybob Clinton………….

  • BenjiK

    Also, S&P recently downgraded Portugal debt to “Junk” status. Europe’s continuing decline is kind of like watching a string of dominoes in sloooow motion.

  • A Dodgy Bloke

    Can’t argue with any of the 20 points by all indications I’m reading the Greek economy is dying. Most of the Greek economy was supported by Government spending and state control of most industries (sounds familiar?). It doesn’t help that tax dodging is a national sport. Greece has long passed the fail-safe point where it can be saved, but I don’t think you’ll see the Euro die. I think you’ll see a Northern Euro made up of Germany, the Netherlands, Sweden, Finland maybe Luxembourg. The Balts the French and everybody else will be on their own. Germany is the best looking house in a terrible part of town. Netherlands still has some North Sea oil, but everybody has serious demographic issues that will kill the Euro and Europe eventually. De Spiegel has an article on the subject it’s a little long, but it has an interesting take on the situation.

    http://www.spiegel.de/international/europe/0,1518,812194,00.html

    • http://www.youtube.com/enslavetherich Janus

      Yep demographichs you are right.. The ageing of the babyboomers and the ones who follow will put huge strains on our social security. Also our retirement funds will see increasing pay with decreasing income. In the Netherlands we can already see how the number of people below the age of 25 is shrinking. Too many things that are not really doing well, which makes a person wonder about the future. Where to relocate itself..

  • Imam

    Greece cannot support it’s present lifestyle. Greeks must start producing more. Simple as that.

  • Cyk

    What you don’t tell your readers:

    – The unemployment rate in Germany is on a historical low, and keeps decreasing.
    Nearly all companies have full order books and keep complaining about a shortage of engineers and skilled workers.

    – The interest rates for spanish and italian gouvernment bonds have dropped significantly

    – interest rates for german gouvernment bonds are NEGATIVE

    – Leading economists (e.g. Jim O’Neill) think that there are no signs of a recession in Europe.

    – Greece has 10 million inhabitants and a GDP of 230 billion euros. That’s about the same as the german province Hessen. (One of 16, and by far not the richest one)

    – Crime rates in Europe are low and constantly dropping

  • miss sealey

    As long as I have enough money to pay for my boob job, nothing else matters!

    • Tatiana Covington

      Damn straight, dude.

  • Moleman

    Well, It seems to me there’s money floating in abundance around the world to make everyone happy. All we need to do is to hand it all over to the banksters and then declare it all worthless. All loans are paid with toiletpaper and we start a new currency, together with a new banking system. Only losers will be the bankers. Oh, I feel so sorry for them….

  • Mr. Squiggle

    Why are they putting up with raising taxes and implementing austerity measures? All they have to do is default. Yes, it will suck for a few years, but they can then rebuild. It’s better than being a slave to the banksters for the next couple of DECADES.. do they think a couple of years and it will all be ok? How’s that working out so far?

  • http://goggle kedar smith

    Why is the economy in various parts in europe is callapsing?is it because of the lack of fair in GOD or GOD has stretch out his hands to repay man for their wickedness.

  • http://goggle kedar smith

    It’s heart breaking to sit and watch the economy of my dream country fall just when I thought to visit.How is that possible?

  • tabletto

    This writing is about economic depression, how it could be avoided, and (if not avoided) how its negative impact could be reduced. This is not always possible, however, as we can see in several countries that are so dependent upon foreign trade and other activities that they cannot influence their own futures. Something can still be done. An economic depression will always cause more poverty and alienation, and even reducing some of these ill effects will be helpful.

    More info in here; http://www.jariiivanainen.net/economicrecession.html