Last week Germany reported that in the second quarter, its GDP declined by 0.2%, worse than Wall Street consensus.
This happened a few shorts days after Italy reported a second consecutive decline in its own GDP, becoming the first Europen country to enter a triple-dip recession. What’s worse, Europe’s slowdown took place before the brunt of Russian sanctions hit.
Surely in the third quarter the GDP of Germany, a nation whose exports accounts for 41% of GDP, will be even worse, with whisper numbers of -1% being thrown casually around, but one thing is certain:
Europe is about to enter its third recession since the Lehman collapse just as we forecast at the end of 2013, a “triple-dip” which may become an outright depression unless Draghi injects a few trillion in credit money (which will do nothing but delay the inevitable and make it that much worse once the can ~ can no longer be kicked), and unless normal trade ties with Russia are restored.
Which means one thing: for Europe to resume the status quo, it needs to break away from the “western” alliance and the sanctions imposed upon the Kremlin which solely benefit the populist agenda of Washington, and certainly not Europe proper, which it is now quite clear, is far more reliant on Russia than vice versa. it is also something Putin apparently was aware of from the very beginning.
And now, that realization is starting to spread to Europe’s own countries, which – while the new cold war was only one of rhetoric were perfectly happy to go for the ride – but now that trade war has finally broken out, suddenly increasingly more want out.
As we reported previously, it all started with the Greeks, a nation of heavy food exports into Russia, who were the first to announce their displeasure with the “Stop Putin” coalition: the moment Russia retaliated, the grand alliance started to crack.
Enter Greece which has hundreds of millions in food exports to Russia, and which was the first country to hint that it may splinter from the western “pro-sanctions” alliance.
According to Bloomberg, earlier today the Greek foreign minister and former PM said that “we are in continuous deliberations in order to have the smallest possible consequences, and if possible no significant impact whatsoever.”