US, EU Economies Like Two Opposite Poles
World Economy

US, EU Economies Like Two Opposite Poles

As the Great Recession was taking hold in America, economists and investors debated how, in this age of globalization, other countries and markets could avoid the financial fall-out. The Chinese and Indian economies continued growing. Australia’s gross domestic product expanded. Indonesia’s economy remained positive.
“Decoupled” was the description. No longer was the world economy in sync, if it ever was. Global profits, however, are another matter, NewsNow reported.
As the current American economic debate is focused on when the Federal Reserve may raise interest rates, European fiscal leaders are poised to go the opposite direction. In the coming week, the European Central Bank is expected to repeat a strategy used in the United States – buy billions of dollars worth of government bonds with hopes of lowering interest rates further. The goal is to entice European consumers and companies to spend again.
While the US economy has returned to growth, albeit underwhelming compared to other post-recession periods, the European economy is stuck. Just one year after the end of the Great Recession, the European economy fell backward again through the middle of 2013. It has turned positive since, but barely.
Many US companies have warned about their European businesses. In recent weeks, Goodyear, Alcoa and WD-40 have cited Europe as a source of weak sales. As more companies report fourth quarter financial results in the weeks ahead, expect to hear similar alerts.
The European Central Bank’s efforts on coming Thursday may be focused on that continent, but its effects could be coupled to the bottom line of American companies and their investors.


Short URL : http://goo.gl/qnqAcz

You can also read ...

An expanding trade war threatens to squeeze incomes.
The untold story of the world economy—so far at least—is the...
PwC Says Australian Firms Deliberately Going Broke
Companies that deliberately fail are costing the Australian...
Asian Stocks Retreat, European Shares Mixed
Asian stocks closed lower on Monday as investors digested the...
Chinese Premier Li Keqiang (C) shakes hands with Jean-Claude Juncker (L) and Donald Tusk after the meeting in Beijing on Monday.
China could open its economy if it wished, European Commission...
Uncertainty abounds in Malaysia, where a two-month-old government is only starting to give  a clearer picture of economic policy.
For Southeast Asia's biggest economies, 2018 wasn't supposed...
Experts Say China Can Cope With Uncertain H2
China is confident it can cope with a more uncertain second...
Turkey Budget Deficit Expands
Turkey’s central government budget balance recorded a deficit...
Global Growth Peaks With a Whimper
It wasn’t runaway inflation or a financial implosion. The...