Woes of the EU

The EU doesn’t really know which way to turn at the moment. It would probably be better, quite honestly, just to dig a hole in the muck-laden ground and stick their heads into it all together. Or crack open the ‘booze’ that the French won’t be selling to the Chinese anymore and drink till the cows come home. The problems don’t look as if they are going to go away. They could always lie, like others do. Oh, the woes of the EU. When it happens it happens in threes, we normally say. So, here are the first two for today. Where’s the third?

Unemployment

EU Unemployment

EU Unemployment

Seasonally adjusted Unemployment figures have just been released (today) and reveal that there has been an increase to 12.1% (May 2013) from April’s figure of 12%. That was the highest ever for the Eurozone and the EU27. Despite positive thinking and hoping against hope, the recession is definitely not at all over for the EU.

May 2013 saw the jobless total rise to 26.405 million (of which 19.222 million are part of the Eurozone today). According to Eurostat, 17 countries of the EU27 now have higher rates of unemployment than this time last year. It fell in 10 of the countries of the EU in comparison with a year ago. Although, the only bit of saving grace was that the actual figure of 12.1% was indeed lower than what economists had originally predicted. They had originally stated that it would see a rise to 12.2% for May 2013. Always bad when you have to rejoice at the fact that the loss is not as bad as had been suspected, rather than getting the bunting out for something positive.  

Some analysts are also prediction that the downturn looks like it is going to get even worse and we are not at the lowest point right now. Austria currently has the lowest unemployment rate of all the countries of the EU (4.7%), closely followed behind by Germany (5.3%). Spain is at 26.9% and Greece at just under 27% (for March, after which there are no other figures available for the moment). Cyprus saw the largest annual rise from May 2012 to May 2013 (from 11.4% to 16.3% in just one year). As a means of comparison, the USA had an unemployment rate that stood at 7.5% for the same period (down from 7.6% on the previous month’s figure and down from 8.2% from the previous May). Some might be well wondering whether the USA will begin to experience a rise in its own unemployment figures after Quantitative Easing is taken away.

Changes in Unemployment EU27

Changes in Unemployment EU27

May 2013 Unemployment EU27

May 2013 Unemployment EU27

 

Youth unemployment was also up at over 23% (5.501 million people aged less than 25 years old in the EU27). That means that there was a decrease of 77, 000 in EU27 countries, but an increase of 60, 000 in the Eurozone. Youth unemployment stood at 22.6% in April last year and since that date it has rose to 23.5% in the EU27 and to 24.4% in the Eurozone in April 2013. So, youth unemployment has seen a slight drop since April, which will come as good news.

But, in some countries (Spain and Greece), youth unemployment stands at over 50%! Spain has a figure of 56.5%. Greece stands at 59.2% and Portugal is at 42% for youth unemployment.

Some analysts believe that unemployment will slowly start to get better now. We shall have to wait and see.

Spying

USA: National Security Agency

USA: National Security Agency

Admittedly, it is only the minority parties in France (Ecology Party and the Front de Gauche), but they have made public requests today for asylum to be granted to whistleblower Edward Snowden. This comes amid greater revelations today that France was one of the countries that were spied upon.

Clearly, both Germany and France have reacted very badly to revelations that have just been made as to the extent of the National Security Agency’s spying tactics on the US’s European friends. Trade talks that open next week may be in for a heated time. Merkel and Hollande stated that it was “unacceptable”. You can’t spy on your friends. Honestly? You can’t? Berlin went on to add that “mutual trust was necessary” for the trade talks to win and that it was ‘no longer the Cold War’. US agencies were secretly listening in on French embassy discussions in Washington, for example and also at the UN offices in New York. Mr. Hollande, President of France, requested that all spying be immediately interrupted. I don’t want to spoil the party, but honestly, did they really believe that spying wasn’t going on? Did they really believe that spying still isn’t going on? More’s to the point, do they really believe that we don’t think they are doing the self-same thing to the US? Clear answers are now being sought as to what the Obama administration did or didn’t do. The diplomatic row is only just beginning and it should go on right up until the actually all sit down around the table at the trade talks. But, I can hardly see them going against the billions that it will mean. Even the French government’s comment of “unthinkable hostility” will be buried and forgotten by the time they sit down and discuss the trans-Atlantic deal to promote economic growth.

 Two’s a crowd and three’s a bore. But, at the moment, there is enough to keep the EU and the US occupied with this problem. But, remember, things always happen in threes.  

So, any ideas as to what the third woe of the EU might be before the day ends?

The CAC 40 was up 0.73% (+27.14 at 3, 766.05 at 8am ET). The FTSE 100 was also up +0.89% (+55.49 at 6, 270.96) and the DAX rose by 0.35% (+27.66 points to 7, 986.88). You have till midnight tonight to find out what it is that will be plight the EU today and bring the old adage to life about things always coming along in threes. I am sure there are a few things that we could all think of! Maybe European leaders have done a bunk and gone off disguised in false moustaches and blond wigs to join Edward Snowden in hiding, worried that they will have to foot the bill and ay the price!

 

 

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tothetick

Professional team of writers/analysts analyzing the financial markets.

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