ECB's Asmussen Sees Adjustment Lasting 10 More Years

Report carried by Dow Jones, via Nasdaq, 15th July 2013

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](https://www.nasdaq.com/article/ecbs-asmussen-sees-adjustment-lasting-10-more-years-20130715-00719#ixzz2ZCdH8mqY)

Blue Horseshoe

And ours will last at least another ten after that, I’d say!

Only 10?
what he really is saying is the stated policy isnt working but we will plough ahead anyway.
It will be worth watching how many economies will be destroyed in the effort.

Isn’t working how? What are the goals of the current policies? By what measure is this ‘not working’?

This sounds like the “austerity isn’t working” mantra, where someone takes the position that 0-1% growth and static job levels are evidence of austerity not working, as if growth and jobs were the intended result of austerity. Austerity is not here to put cash in your pocket.

Yes, Europe will plough ahead, being prudent, until the tide comes back in. We are not in a position to create that tide. The greedy debt monkeys must be in a position to pay for credit before we can start offering to feed their desire for consumption. The prudent cannot create the demand amongst themselves, because by definition they are not as consumerist as the greedy monkeys.

If Ireland had its debt wiped in the morning, we’d be straight into Partnership 2.0, investment in the housing sector, and construction jobs for the boys.

The economies are already destroyed. The blow is being softened by massive stimulus (deficit spending) backed by promises.

By this measure:

In 2004:
Cypriot youth unemployment was 9%
German youth unemployment was 13%

In 2013:
Cypriot youth unemployment is 35%
German youth unemployment is 7%

If you’re going to quote two countries we should see it across the board, unless you’re implying a transfer of youth jobs from Cyprus to Germany?

Furthermore, these are two very different economies. A lot of Cypriot youth was likely engaged in the tourism sector, which must have suffered as rich European economies began to scale back discretionary expenditure. You have cited two countries, one which had the ability to scale back and another which was totally dependent on foreign money.

The goal of European austerity isn’t to pump money into profligate economies, it’s to restructure profligate economies and balance their budgets so that they can survive until prudent productive economies rise. The South of Europe will always be reliant on transfers from Northern Europe, until the people undergo a culture shift and end their respective national celebrations of profligacy and corruption.

Greedy Cypriot debt monkeys complaining about their 35% unemployment! :angry:

They all partied

By having jobs, the bastards

And so they should have just pumped a load of money in there, so that everyone can have a job?

They had a fluffy financial services economy, the money from which trickled down to support local economy which was otherwise dependent on tourism, shipping, etc.

It’s the same effect as our construction economy. When you over-invest in unsustainable economies, people flock to that line of work and when the jobs are gone they’re gone, and you have a chunk of your economy missing and no productive investment to hoover up those lacking skills.

Sure, you could at a lower level try small parts of stimulus, but the whole system is broken because we had a bubble in everything. What would you spend you stimulus package for Cyprus on? Construction? What do they do a few years afterwards? Are they likely to recreate their services exports? Is money going to start flowing through Cyprus again?

Austerity is about finding our level again. When the dust settles there will hopefully be more moderate growth, with targeted investment in economies rather than political enablement of get rich quick ponzi schemes

Looks like it’s working then.