On Thursday the World Bank cut its estimate for global economic growth in 2013. The bank cut its growth forecasts for China, India and Brazil while raising its growth projection for the U.S. and Japan. Almost as an aside the World Bank mentioned the stubborn problems in Europe, noting that matters were being exacerbated by austerity measures.
The eponymous head of Hugh Johnson Advisors says anything that doesn't involve Europe actively getting worse as an improvement. As a matter of fact he thinks European recovery in the second half of the year is starting to take shape.
In the attached video, Johnson is quick to qualify his prediction by noting that the situation isn't getting better in the EU, it's just not getting worse. Compared to the erosion of the last few years achieving even moderate economic growth would be a triumph. Johnson says he's seeing a subtle change in the nature of the European situation.
"Anecdotal data seems to indicate things are turning around," says Johnson citing news out of the UK in particular. "Although this could be another head-fake this one might be for real."
Whether or not Johnson is right depends largely on how fast the northern countries of the Eurozone move away from the austerity measures retarding economic growth in the so-called PIIGS. Unemployment in Spain and Greece is still over 20%. For the sake of context, U.S. unemployment topped out at an estimated 25% during the Great Depression.
Unless and until the lesser countries of Europe participate, the notion of recovery is largely a matter of semantics. Regardless the business cycle alone suggests a improvement on all measures is looming, it's just a matter of getting the politicians out of the way.