Who will do less badly? The United States or the euro zone?

- "The perception of the financial markets is oscillating: in very late 2009 and in early 2010, the consensus forecast an economic recovery in the United States, but not in the euro zone. Subsequently, investors turned despondent about the United States, before a slight upturn in confidence at the end of the summer 2010."- "What should one think in reality? Which zone, the United States or the euro zone, will post less deterioration in its economic performance after the crisis?"- "We have to compare:• productivity gains, and their probable trend (which depends on the investment drive, the utilisation of corporate savings, etc.);• industry’s capacity to benefit from the robust growth in emerging and oil-exporting countries;• the efficiency, the more or less reasonable nature of changes in income sharing;• changes in the breakdown of jobs between skilled jobs and lowskilled ones (with low wages);• the solvency of borrowers and the outlook for credit;• the need to improve public finances."- "We find that the euro zone is in a better situation than the United States for 4 criteria out of 6, and in an equivalent situation for the remaining 2."

Natixis Flash Economics 458 20100914