Alternative Visions - Europe—‘Sick Man’ of Global Economy - 12.14.18

Europe’s economy is stagnating again. Dr. Rasmus reviews the 3 key elements of its growth strategy: (1) free money from its central bank, (2) internal devaluations (aka labor market ‘reforms’) to drive down wage costs to make EU exports more competitive, and (3) fiscal austerity. Rasmus explains how all three are now breaking down as Europe’s GDP recently stagnates at 0.2% for 3rd quarter 2018 reveals and as economic and political problems promise to intensify in 2019 as the global economy slows:  mass street protests in France, populist challenges to Euro austerity rules in Italy, nationalist and separatist movements multiplying, problems with Euro banks (Deutschebank, Italian banks, Credit Suisse, Greek banks, etc.), the European central bank’s just announced suspension of QE bond buying, and the ‘hard Brexit’ looming—all represent the unraveling of Europe’s economic recovery strategy, making it the ‘sick man’ of the global economy as the world (and US economy) slows heading in 2019. Before the discussion, Rasmus provides an update and review of topics of recent weeks, including the prospect of Fed rate hikes, US deficit and debt trends, global oil prices, and the latest developments in the US-China trade war occurring the past week.