domenica 17 agosto 2014

"Italia Treno in Corsa" (ma NON "nell'accezione fanta-renziana"...)

Come sempre IMPERDIBILE l'Analisi 
dell'Economista (senza offesa...) 
non allineato (cum laude...) Edward Hugh...
Il titolo: "Italia Treno in Corsa" 
la dice già molto lunga...
e vi posso assicurare che NON va inteso nell'accezione fanta-banfa-renziana 
di "Italia come Locomotiva che trainerà l'Europa" e di "Italia che si riprenderà a settembre con il botto"...
L'accezione più calzante sarebbe..."Treno in fuga (verso il precipizio...)"

L'analisi è come sempre NE VALE LA PENA.
Ecco l'inizio 
ed alcuni grafici molto mooolto mooooolto eloquenti..................

The Italian Runaway Train

There has been lot’s of debate in the press and in academic circles over the last week or so about whether Italy’s latest contraction constitutes a triple dip recession or simply a continuation of what’s been going on over many many years.
This is an interesting theoretical nicety, but in fact what is happening in Italy at the moment goes a lot further than problems faced by a recession dating committee.
The real issue that arises in the context of the Euro Area at the moment is a far more specific one.
Will the ECB do QE?
And if it does when will it push the button?
And what could happen if it doesn’t.

Perhaps a case study of the Italian case is worth the effort here.
What is likely to happen to Italian debt if there is no ECB intervention soon?
Let’s take a look at the dynamics.
By now almost everyone and their grandad knows that Italy is back in recession following the 0.2% GDP contraction in the second quarter.

Not only did this result suggest that Italy was now in a triple dip recession (or a twenty year decline), it also meant that GDP was back at the same level it had in 2000, when the country entered the Euro currency union.

The problem is that Italy has an appallingly low trend GDP growth rate – possibly negative at this point – and nothing which has happened since the financial crisis ended suggests it is going to to improve radically anytime soon, in fact there are good reasons to think that  growth could  even deteriorate further.

In the first place Italy’s working age population is now falling, and many young educated Italians are leaving to work elsewhere.

And now, not only do we have the legacy then of high debt and low growth,
a new problem has emerged: low inflation or even deflation. Italy’s inflation has fallen to zero.

The combination of low inflation and low growth means that it is the evolution of nominal GDP that really matters now.
Nominal GDP is non inflation corrected GDP (or GDP at current rather than constant prices).
If inflation remains low or even becomes negative, then nominal GDP will hardly increase and may even continue to contract (as has happened in Japan).
The result is bound to be that the gross government debt to GDP ratio rises above the 135.6% it hit in March.

One of the arguments frequently advanced about how this dynamic could be turned around would be for Italy to run a “large” primary budget surplus.
Now the emphasis here is on large since the country has in fact run a primary surplus (income – expenditure before paying debt interest) since the early 1990s, but that hasn’t stopped the weight of the debt climbing and climbing...................
(sul sostegno attivo - donazioni/pubblicità - già conoscete alla nausea il mio punto di vista...)

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