It’s ending in America

As the whole expenses scandal rumbles on, the economic crisis has been knocked off the front pages. But it hasn’t gone away. Today there’s an interesting article in the Washington Post saying that while the worst is over in America, the recession in Europe will be longer and deeper. (The numbers the Post mentions about Britain are particularly grim). Here are the key paragraphs of the article:

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“Nine months into the worst economic downturn since the Great Depression, the free fall in the United States appears to be giving way to a more measured decline, but economists are struggling to find a steady pulse in European and other industrialized nations, such as Japan, where the world's second-largest economy is also slowing the global recovery. These countries' recessions are shaping up to be both deeper and longer than the one in the United States, where the pace of job losses has eased and there are fresh signs of life in financial markets.

There are hints of stabilization in the Old World -- in Germany, for instance, investor sentiment is up amid indications that factory orders are stabilizing after months of sharp drops. But many economists now say Europe will trail the United States in pulling out of recession by at least three to six months.”

The Post also notes that by the IMF’s calculations US banks have already written down roughly half of their $1.1 trillion worth of troubled loans and toxic assets, while European banks have only dealt with a quarter of their $1.4 trillion worth of bad debts.