The small country of
Portugal has suffered through economic
hardships imposed by Europe, and its supposed
recovery, or the beginning of a recover or what may be the start of a recovery
has been hailed by European policy makers as an example of how their policy
works. Not so fast.
had appeared, at one
level, to be successfully executing the euro zone's crisis playbook. From
summer 2012 to late May, its bonds strengthened sharply, giving hope that it could
wean itself from euro-zone rescue money by next year. Portugal
So what is happening now? Well this.
But the financial-market calm masked economic pain, some brought on by the austerity measures themselves. The economy is projected to contract 2.3% this year, following a fall of 3.2% in 2012. When the bailout was planned two years ago,
had been expected to be growing this year. Portugal
The pain has weakened the government, which has gamely tried to carry on with austerity despite deep popular discord. "The muddle-through process in the political system has been invalidated," said Steen Jakobsen, chief economist at Saxo Bank.
The surprise here, no its not the state of
economy and political system, that state was easily predictable. No the surprise is that anyone expected