Just How Much of a Eurozone Rebound Really Was There in Q3?

Just How Much of a Eurozone Rebound Really Was There in Q3?: "

Sorry, and I apologise in advance: in this post I'm going to be a nit-picker.
The question in hand is the Eurozone third quarter growth one, and the
story is all about differences (between countries) and these
differences in the key cases (France and Germany) are in many ways all
about inventories. So maybe I should have titled the post 'all about
inventories', following Pedro Almodovar's cinematographic lead in
cycling and recycling that old 'all about Eve' metaphor - necessity is
the mother of invention, and movements in inventories are progenitors
of both growth, and of that notorious double dip difficulty. So just
which one of these is it that we have on our hands here?

Indeed,
the fact that the devil, as always, lies in the details should not
really surprise us since economics isn't that different from other
sciences, and isn't such a difficult subject to work
with - even if some journalists and lot of bank analysts are able to
make it look like it is by managing so frequently to make a dogs dinner
out of what should really been an ever so plain, ordinary, and simple
vanilla-flavoured ice cream. Let me explain.

Before getting
bogged down in all that horrid detail let's register a very simple
plain, evident, and totally undisputed item of fact - the 'eurozone
sixteen' economy (whatever that rather nebulous concept actually refers
to, when you dig down a little below the surface) poked its nose
timidly out of recession in the third quarter of this year, with gross
domestic product in the 16 countries using the euro rising 0.4 percent
from the previous quarter (see chart below). This return to positive
headline growth technically brings a recession which lasted five
consecutive quarters of shrinking output to a close - even though
output was still four percent below that registered in the same period
in 2008. So evidently we are out of recession, but are we out of the
woods yet?

Well,
basically I think we aren't, and to explain why I think we aren't I'm
going to pick (yet one more time) on poor old Frank Atkins of the
Financial Times. It almost hurts me to do this, since I am not trying
to say that Frank is an especially bad example of economic journalism
(far from it), even if he is sometimes very badly served by his
headline writers, writers who over the weekend managed to switch what
was Friday's declamatory 'Germany powers eurozone recovery' version (and for those who like twitter here) to Sunday's much more modest 'European recession ends with a whimper' one. However since this is now the second time in just over as many months that Frank has wheeled out the German economy 'powering' something or other
word out, I cannot help concluding that either he really likes the
expression, or that he must know something I don't about what is
actually going on in Germany, since structurally speaking it would seem
to me that such 'powering' is now completely impossible, given the
economy's evident export dependence.

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