Economic growth in Europe surprises big time

Second quarter economic statistics for Europe are out today and the numbers are very surprising.  The growth, while a modest (by U.S. standards) 1.0%, was the fastest in four years.  That 1.0% growth was as compared to the first quarter of 2010.  When compared to the second quarter of 2009, growth was 1.9% higher.

Analysis: Here is a statement on the fickleness of the financial markets.  Back at the beginning of May the thought of a financial crisis in Europe that would precipitate a double-dip European recession and a consequent U.S. double-dip recession.  Egads!  Those trumped up, fear-based assumptions drove U.S. markets sharply lower and have led to continued fears of a double-dip recession, or a super slow economic recovery, in the U.S.  But guess what?  The European scenario never played out.

What we have is a worldwide economy whose fundamentals are stable, yet fragile.  Any news, good or bad, has the potential to sway the worldwide financial markets hugely.  Unfortunately, there is a bias toward bad news having a greater impact at this point.  Proof of that belief is that there are two very positive pieces of economic news this morning (see the post below), yet the financial markets are break even as of this posting.

Importance grade: 8; 2; Why the differences in rating?  In my opinion, the positive economic news out of Europe deserves an 8.  But in actuality this data is being ignored by investors.  Ugh!

Jason