I read an article in the Wall Street Journal recently entitled “Flat Growth in Bloc Fuels Recession Fears” (Nov. 16th issue). It discusses the economic state of the European Union and its disappointing numbers from the third quarter, especially with respect to the recession which supposedly ended two years ago. France and Germany (which account for half of euro-zone GDP) had a bit of growth, which indicates that the rest of the zone contracted, since the total growth was just barely positive. The article addresses rising fears of an upcoming recession and states that “people are really down” and expecting the worst. This reminded me of the lecture in which we discussed the Great Depression in the US and how ‘bank panics’ may have fueled the depression even further. Although the case in Europe is not exactly the same, it is interesting to note that even though nothing terrible has happened yet, people are very worried about falling back into a recession – which could cause panic in time.
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