Europe's malaise: The new normal?

By George Friedman

But the definition for a non-performing loan has been flexible in Europe and other places before, and the simple question remains: How can such long-term high unemployment rates not produce significant problems in consumer debt?

Given Europe's unemployment, Germany's need to export to the rest of Europe, and persistent weak growth rates now spreading to Germany, it is simply not obvious what force will reverse this process.

Exports continue to grow, including exports to the rest of Europe. (That is one reason it has been so difficult for the rest of Europe to recover: Having lost the ability to control access to their markets, other European countries are unable to compete with German exports.

Portugal, with lower unemployment rates, has an 11 per cent non-performing loan rate.

Read more here: Business Spectator

    

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