"Outsiders" Economy Watch (11/24/2011): Scary Times
I begin this edition of the Economy Watch with earnings from HP. HP is one of the leading technology companies of the World which had a very challenging year before it appointed Meg Whitman as its' new CEO. She announced a 91% drop in its' earnings and told investors that 2012 will be a very tough year.
Why is the outlook for HP important? Because HP is an indication of what is potentially on tap for the World in 2012. Europe, for all intent and purpose, is pretty much broke. Germany had its' worst bond sale since the launch of the Europe.. Spain and Italy have been paying record rates for their bonds. France's Credit rating is in danger of being downgraded. Britain's growth has stalled and it may even enter recession in 2012. Portugal, right now, is bracing for a general strike to protest austerity measures that is taking a tough toll on the people.
When I released the "South East Watch" earlier in KP's sister site, Smooth political, I noted how the Chinese are starting to deal with profound labor challenges in light of orders not coming in due to slowdowns in orders from around the World. The slowdown in China will also have profound impact on how the World will continue to deal with the aftermath of the recession. The biggest player, in the mean time, continues to be the United States with its' own challenges.
The U.S. continues to experience growth according to official government figures. This is as the national debt of the Country continues to grow and just passed the 15 Trillion mark. It gave Republicans further ammunition to push their own plans for tax cuts and governments cuts without fully understanding and realizing the implications of this action. This is as the United States has no budget and the so-called Super Committee's deliberations went no where which will cause automatic cuts to go into effect immediately.
What will happen now? It is a big question indeed.........
Why is the outlook for HP important? Because HP is an indication of what is potentially on tap for the World in 2012. Europe, for all intent and purpose, is pretty much broke. Germany had its' worst bond sale since the launch of the Europe.. Spain and Italy have been paying record rates for their bonds. France's Credit rating is in danger of being downgraded. Britain's growth has stalled and it may even enter recession in 2012. Portugal, right now, is bracing for a general strike to protest austerity measures that is taking a tough toll on the people.
When I released the "South East Watch" earlier in KP's sister site, Smooth political, I noted how the Chinese are starting to deal with profound labor challenges in light of orders not coming in due to slowdowns in orders from around the World. The slowdown in China will also have profound impact on how the World will continue to deal with the aftermath of the recession. The biggest player, in the mean time, continues to be the United States with its' own challenges.
The U.S. continues to experience growth according to official government figures. This is as the national debt of the Country continues to grow and just passed the 15 Trillion mark. It gave Republicans further ammunition to push their own plans for tax cuts and governments cuts without fully understanding and realizing the implications of this action. This is as the United States has no budget and the so-called Super Committee's deliberations went no where which will cause automatic cuts to go into effect immediately.
What will happen now? It is a big question indeed.........
Mike Pouraryan
