Now, you are going to point to PPP values, for sure, because the US is still ahead a bit there, by about 20%. The problem with that is, the US have nominal wage decreases the past 5 years, and this trend seems to continue. Also the US have higher inflation than the Eurozone at least, probably also higher than the EU27.
The EU on the other hand, is enjoying high wage growth, 3-5%, with lower average inflation than the EU. This is creating a situation where the EU ppp is rapidly catching up to that of the US..
So I ask you then, is the GDP of France and Germany really low? And the PPP of France and Germany is rapidly improving while that of the US is in decline. What does that tell you?
No, it's not EUs PPP is not catching up to the US and predictions show low PPP growth for the coming years. The argument that because they have high wage growth, but not so high inflation is flawed and wrong. GDP (ppp) is based on productivity.
Also, we base ourself on PPP number. Because Iceland halved it's nominal GDP the last year, but does that mean the productivity of Iceland is halved. Of course not.
Here is the real list based on PPP.
1 Qatar 86,008
2 Luxembourg 82,441
3 Norway 53,738
4 Singapore 51,226
5 Brunei 50,199
6 United States 47,440
— Hong Kong 43,847
7 Switzerland 43,196
8 Ireland 42,110
9 Netherlands 40,558
10 Iceland 40,471
11 Kuwait 39,915
12 Austria 39,887
13 Canada 39,098
14 United Arab Emirates 38,894
15 Sweden 37,334
16 Denmark 37,304
17 Australia 36,918
18 Belgium 36,416
19 United Kingdom 36,358
20 Finland 36,320
21 Germany 35,539
22 Bahrain 34,662
23 France 34,205
24 Japan 34,116
25 Republic of China (Taiwan) 30,912
26 Greece 30,681
27 Italy 30,631
28 Spain 30,589
GDP doesnt really matter that much anyways. To do a proper analyzes have a look at the health of the companies and the nature of the economic stability and growth. When that growth comes from debt for example, as oppose to industrial or service sector growth, then that growth is really not growth, its borrowed growth, and will only contribute to reverse and slow that growth again later. Also the nature of the total economy matters, for example the UK have the largest financial sector economy of the world, a sector that in reality only works to steal money from the hard working people of other sectors.
Such is the nature of the economy in very basic term, and pointing to a war of GDP numbers and silly nationalism, is not going to get this economic debate interesting.
When people start saying that we shouldn't concern ourself about GDP, productivity and similar, then they just try to defend their own country poor performance.
In todays world. You need to compete to be able to live, because if you don't then there are no guarantees for future wealth. Look around yourself, how much was made in your home country?
The productivity growth is slow, but its also slow in the US. A reason for this could be that the world has reached a "limit". And with other countries growing much faster now, there is little real need for increased western productivity. IMO. There are many reasons for it, but thats what I think. Even so, per hour productivity is better in France and Germany than in the US.
Europe has done quite ok in this crisis, we only shed of growth that came from unrealistic sources. The US is our largest market, and of course we will be hit by a US crisis. An interesting fact however is, that all the worlds largest banks(in terms of sales and holdings) are European. So yes, when the bank sector is shaking, even solidly capitalized European banks are hit.
Not like Europe. Many countries in Europe have nearly had none productivity growth. In the US productivity has slowed down, but it hasn't stopped. Don't take future wealth for granted. Beeing rich yesterday is not a promise for future wealth.
Of course per hour is increasing. What do you excpect when people work less hours? I However, my point is that Europe is performing badly, and there are a lot of future problems to come, and they are not opportunities. They are problems.
Have a look at all sectors of businesses. Look at their sales/profits and holdings rather than market value. Also keep in mind France/Germany is tiny geographically compared with the US and has together only half the population. Yet, look, the best companies are German/French ones, while European companies dominates most sectors, except retail, media and 1 or two other where US companies dominate.
Also consider the sectors and start thinking about which sectors are really important. For example, weight durable goods against drugs, and think of the level of corruption in this sectors. Then think about all sectors and how they are important/unimportant etc, and then look at how European companies dominate every sector, except medical equipment, which is an important sector that the US dominate.
That's because Europe has been previously succesful and they are pretty much all old companies. Geographical area is not the determinant for the place. It's number of people, and Europe has a much bigger population. However, this is like kids comparing how strong their Dads are. It has no relevance to Europe performance.
And, it doesn't matter how important a sector it is. Money is money. You are just trying to make up excuses for Europe bad performance.
However, by the population Europe should have two third of the companies, and because it's not really fair due to localization. We remove oil companies. I also remove non-european and non-american companies,
1
General Electric United States
6 HSBC Holdings United Kingdom Banking
7 AT&T United States Telecommunications Services
8 Wal-Mart Stores United States Retailing
9 Banco Santander Spain Banking
15 Volkswagen Group Germany Consumer Durables
16 JPMorgan Chase United States Banking
17 GDF Suez France Utilities
19 Berkshire Hathaway United States Diversified Financials
20 Vodafone United Kingdom Telecommunications
22 Procter & Gamble United States Household & Personal Products
24 Verizon Communications United States Telecommunications Services
27 EDF Group France Utilities
28 IBM United States Software & Services
29 BNP Paribas France Banking
I actually think United States beats Europe in this one. It also seems like US got more useful companies, just mention because it's so important for you. To base your economy on banking it's not very smart.
German unemployment has risen least of all economies of the west during the economic crisis. Germany now has about 7.5% unemployment(eurostat). French unemployment hasnt risen much, while US and UK unemployment has, revealing where all the uneccesary jobs are.
Just excuses. Germany reduced their unemployment by jobsharing programs. A good way to hide unemployment, but in reality Germany was hit hard by the crisis and is also entering a demographic crisis.
Iceland is tiny and they did the mistake of not being in the Eurozone or EU.
Ok, what about Argentina, Latvia, Greece. Beeing small has nothing to do with it, neither do EU.
True.. This is the weakest point of the European economy, the Spanish deficit, which is only countered by the huge German surplus, which is not a proper correction.
Really? What about Greece, Italy an other European countries defiecits? What about about the countries in East Europe? What about the demographic crisis?
I think the population decrease is an oppertunity. Also they dont have slow economic growth and low GDP which I proved above. Slow economic growth in unneseccary sectors yes, ok..
Slow economic growth in unneseccary sectors? Seriously! What kind of bull**** excuse is that? Population decrease an opportunity? It is a problem, not a opportunity. It means that less people have to sustain more people. That means lower GDP, higher taxes, worse public sector or public deficit.
You are a classical example of why EU are doing so litte, because you consider yorself flawless. If I mention that EU has a slow economic growth, then you tell it's only slow in uneccesary sectors. If I tell EUs economy is performing badly, then you will begin comparing size of companies, which has pretty much no relevance.
However, the points I make for why EU got trouble, you don't even answer at all. The demographic problem is only a opportunity or some bull. The immigration dilemma wasn't even answered.
