Topic: Netherlands enters a technical recession (Read 285 times)

Who is this "they" who "don't want the general public to know"? In free societies, unlike in places like Russia and China, information is readily available from all sorts of different sources for anyone that goes looking for knowledge. Recessions are a natural part of the economic cycle and you'd have to be pretty dumb to think that they are not or that it's shameful to be in one, only people who sap up rubbish from leaders like Putin or Xi Jinping would fall for this mistake. Inflation is happening in varying levels in countries all around the world, so again it is nothing special to be happening in the Netherlands and is actually a pretty normal situation to be facing right now, that will recover.

The European Central Bank has been doing some rate hikes/tightening of their own to control inflation. A recession is a side-effect.


There were people who were called "alarmists" when they started saying that a major financial crisis was coming during 2005 - 2006. The actual crisis didn't start until 2007 - 2008. Patience and save money. Another golden opportunity might be coming.

 


They're not immune from the "sickness". DYOR on Icelandic Financial Crisis when the value of the Krona went down against the Euro by 35% and banks started to fail.

What's up with European countries falling ill lately? Are these connected or isolated ones?

With the way things are going on the west you'd expect the US to fall face first before the rest of the planet, considering their piss-low recession's been marinating on its seat for years now, not to mention the pressure that the east is putting the rest of the world under by means of economical warfare. All of a sudden we find out Turkey's falling into despair, the war on Ukraine's still ongoing but now Russia's completely scraping by as even their mercenary for hires kicked them to the curb, and then we got here Netherlands falling ill on some sort of stagflation which is really depressing.

Amidst this I feel like Iceland's going to be the remaining country in the planet that's not afflicted with any sort of economical sickness lol.

What energy problem are you talking about ?
If we talk about gas supplies to the EU - this problem is already solved, yes, gas is still a bit more expensive than it was 3 years ago, but the price is constantly decreasing, the restructuring and diversification of gas supplies to the EU is coming to an end. There is no critical shortage... Moreover, the measures taken in the EU to optimize gas consumption have completely offset the risks of gas supply interruption from Russia.
Everything else, including electricity, has also fallen sharply in price, which you can easily check - the data is open. If we talk about the "locomotive" of the European economy, Germany, there are excellent indicators there - a noticeable decrease in unemployment, a resumption of industrial production, as well as medium and small businesses, and an increase in tax revenues.

Imaginary? No it's not, ser. There's nothing imaginary about a country's GDP going down for two consecutive quarters. What it should really be is a warning that people should start saving and put some of their savings in safe haven assets like Bitcoin because inflation is still high. It's not really a "technical recession", it's Stagflation. That should make people worry more.

Or, is it because people now have a reason to save money so instead of spending it on stuff, they are sticking it into interest earning accounts.

When interest rates for savings type accounts were sub 1% it's easy to say screw it and spend instead of saving it.
Now savings is at over 5% a lot of people are thinking I'll put off that larger purchase and make some money.

It's interesting to see it here in the US. There is a certain portion of the population who believes that current high interest rates are killing the housing market because nobody wants to pay that much interest on a mortgage. Then there are the people who understand that a large amount of housing was bought as an investment and now if you have the cash to buy a house you MIGHT make 7% to 10% a year. But there is risk involved. Or you can make 5.25% by clicking a few buttons and opening a CD.  [ https://alto.bmo.com/en-us/high-yield-cd ]

The counter argument is that if inflation is at 6% and your savings is at 5.25% you are loosing money.
But, inflation is really a lot lower then that since there were a lot of prices that were distorted due to covid that are just now stabilizing. But it's tough to get a real number. Case in point since I am dealing with it.

Is fiber optic cable REALLY 30% more then it was in 2019? Well, yes sticker price it is. And if you walk in off the street into a lot of places it is. But, order more then $100 and get 25% off your cable order at a lot of places. Hmmmm. So it's not up, you just want me to buy more.....

Heck it even goes to cookies [the eating kind not the browser kind] the ones I eat are WAY WAY WAY up in price. As in 35%+ if you walk in and buy them.
EVERY WEEK AS IN EVERY WEEK NOT MOST BUT 15 OUT OF THE LAST 15 WEEKS. There is a coupon or sale at one of the local food stores that puts the cost  BELOW what I paid in 2017.  Yes I keep and scan just every receipt. So are they up in price or are stores just making a cash grab because they can? And, I don't blame them for that. It's their job to make as much money from consumers as they can.

-Dave

What's so surprising about this news ? It is a "normal" indicator for most countries in today's period of global economic crisis. It was laid by the pandemic Covid-19, and even if people in a certain country did not get sick en masse - the WORLD economy suffered very seriously. And given the high level of integration of many countries in the world economy, they also become participants of the global crisis.
Well and the second question - 0.3% is a noticeable but not critical indicator, and if you take the average economic indicators for the last 2 years for the Netherlands, their indicators will be noticeably better than many other countries.

Hungary is an example. In addition to the real problems in the economy, which have been going on for a long time, the country is constantly demanding huge financial aid from the EU, instead of solving internal problems. This is a really problematic country against the background of the Netherlands.

Almost 10 years ago, there was a recession and now another recession. Enough of the problems. What are the solutions. What can individuals and the government of the Netherlands do to salvage the situation which they have found themselves in right now. Is is to+
For individuals get more sources of income, save money, buy Bitcoin, and other assets?
For the government, print more money, reduce interest rate, buy bonds, them acting as the lender's last resort ?

Recession is everywhere but it's just that many countries try to keep the news from the public whereby making life hard for the masses. I hope things will get better soon with the way I'm seeing it, it might take a longer time for most of the problems the world is facing to be able to vanish or settle down coupled with the war between Russia and Ukraine which is making the price of grain and food stuffs to keep increasing in price because of scarcity and inadequate supply. Every countries of the world is facing this problem of inflation and we hope  things will get better with time.

Most probably this is due to the energy crisis. Caused by Covid initially, it got worse with the start of the Russo-Ukrainian war and sanctions.


https://ec.europa.eu/eurostat/web/products-eurostat-news/-/edn-20220210-2

But that was just the beginning. Much worse things followed:


https://www.greenmatch.co.uk/blog/energy-prices-europe

I feel like this will not be a big deal at all. Europeans see these numbers and think that they are going to suddenly starve to death or something, that's not what happens. As someone from another part of the world where it's normal to see these things, life just continues the way it is without any issues. Obviously you need to make some changes, like for example in the USA the inflation is insane, and prices are super higher, and yet they didn't increase the minimum wage per hour at all, that's a wrong move without a doubt.

I think it should be reminded to everyone that as long as you take the right precautions then these type of stuff like stagflation is not going to hurt your nation more than you think, it will be fine.

It sounds good? Oh yeah, wait for sometime and same companies will start laying off the employees. When we say that there is increased wager above inflation, it can only counter the daily needs and costly affairs but it can't keep up the steady earnings or revenue generation for the companies that are paying those high wages. If Government is promising anything at this point, like some sort of schemes and shit then it's gonna be only in theory and they would do nothing because their treasuries are not doing so well either.

The only issue with the western countries is their highly advance lifestyle that is only "presentative" and not real one is what causing this drama of stagnation in few countries. Obviously the list is long. Automation is increasing, AI has entered the market, why the fuck owners would give any shit about employees increased wages if they could just pay pennies on maintaining automated workflows? Guess what, AI doesn't need to pay the taxes, non employed person neither. The national treasury during the inflation is gonna get brrrhh!

You pointed a good reason but that reason is not the root of the recession that was the aid that they provide to those who need it. Means the reason was that problem which needed AID. In short, our country is also printing a lot of money why? I hope they must have gold to back them up but if they don't then they are gone. We were at the edge of declaring as Default but what we did we took more loan to avoid Default.

We as nation, a single country are stuck in Debt cycle and all we can do is how to reduce that debt by time without saying or going against Governments. Yes! we have no freedom of speech here too.

The point i am trying to make here is, The country itself and the governments it self are responsible for the status of the nation.

The Netherlands is one of the largest economies in the European region. I think this will be an important warning for the rest of Europe and even the rest of the world. In fact, we can't expect anything else when the FED has raised interest rates close to 6% and we have to interpret this as a natural consequence... We are going through a really uncertain period. I will try to take precautions by buying Bitcoin and gold. Bitcoin makes me happy these days by giving good buying opportunities. I hope I can turn this crisis into an opportunity. I wish everyone good luck...

We should not only see the positive side, but also look at the challenges and difficulties that a country like the Netherlands faces. The economic situation is changing rapidly, and no one knows for sure what the future holds.

Factors such as inflation, rising costs of living, and the rise of automation all create a challenging environment for residents and businesses. "Technological recession" could affect job creation and economic growth.

However, positive prospects can also be seen in efforts by governments and leaders to find innovative solutions to these challenges. Summarizing experience and adapting to new circumstances has always been an important part of building a strong economy.

They won’t be the last country to fall into recession in the next 6-12 months. This is all a result of shutting down the world due to COVID. So much money was lost & subsequent money printing that followed has done this damage. It’s going to be tough for a lot of people over the next year or so. We are here on a bitcoin forum so you know what to do to preserve your wealth & purchasing power.

The easy answer for alot of Europe is energy costs, unless that nation has alot of oil or gas.   Apart from Romania and Norway I cant think any of them have good access to energy.  France perhaps has nuclear but even then their main power provider is suing the government for forcing them to make a loss.     So energy in turn makes everything more expensive, food and retail of many goods is easily going to rise if transport costs more.
  Simple causes of inflation are of course excess money availability but also that supply of goods is in any way impaired.   The Euro fell from any strength its had making imports more expensive generally.   Netherlands is still a wealthy country but we are talking percentage changes, its been impeded for 2 quarters.
  Long term ECB like the FED and other big central banks are juggling too much debt, that will matter as it creates certain excess supply of currency to pay for that debt.  Fiscal budgets are in deficit also, again loose policy.   It will be true for a decade, currency loses money and I think for even longer the debt is 30 years or more and nobody wants to repay it.

It's a result of both -- Russian/Ukraine war and COVID related expenditures caused inflation: https://www.worlddata.info/europe/netherlands/inflation-rates.php

Core inflation was less, obviously. You can look at currencies like Swiss Franc if you want to get an idea of how energy prices effected inflation. Swiss Franc peaked at ~3.5% which was significantly lower than other currencies in Europe. Of course Switzerland did not aggressively print money during COVID as other nations did. Predictably, their inflation rate was much lesser than others even after their energy prices rose.

We have been scared of a recession for so long that we can hardly believe it anymore. A technical recession is some kind of imaginary recession. I am sure that soon the news background will change - and in the short term, speculators, as always, will be on the plus side and alarmists will be on the big minus side.

This is a pretty bad situation to be in. Honestly recession is something that I feel is cyclic, no matter what are the government policies or economic strength of a country it will eventually come & it will eventually haunt everyone. However, Stagflation is a human error. Errors made by the policy makers who did not completely understand the intensity of the situation and made incorrect decisions, because recession can be forecasted and if it's already forecasted it's a wise decision to make sure you don't have high inflation, which too can be easily managed by controlling interest rates & fiscal measures. With 20% inflation situation can get even worse as unemployment kicks in eventually.

Oops, I forget that there was COVID-19. I really am losing memory hehe. Well, it's not that we are not affected by it but it's like I never took it that seriously because that was all drama people were killed at that time just to collect bodies and sell bodies part here in my country. We are afraid to go to the hospital because there are many stories. Let me tell you one in which a young boy with his friend went to the hospital for some Bandges and the nurse said the injured one to wait in the room while the other was outside and after some time they said to that friend that your companion just passed away and they do not even allow the family to see his face and not allowed anyone to touch him.

The point is he was just injured in his arm and that injury could never kill a kid so how a young boy just got killed. Not just that, the same event occured in my village. And this all were fake reports to kill innocent people. Why they did it is just a mystery to me. But, Thanks for reminding me of COVID.

The website says that the wage grew above inflation, which seems good to me. I mean, yeah, the economy is not growing, and that's not great, but is it really that bad if a country is at a decent state when its economy stabilizes? The Netherlands is 11th in the world in GDP by capita, and 17th by GDP in the world overall. They have a pretty low unemployment rate, and percentage of people below the poverty line. I think when we talk about stagnation, it's really important to note the difference of stagnating somewhere near the top and stagnating when the country's economy is terrible, even with constant growth.

It's a little bit surprising to see that the Netherlands recently suffered from two consecutive quarters of negative growth. This is because the economy bounced back more quickly and strongly than most European nations after the COVID-19 pandemic. This adverse economic condition was mainly caused by the decline in exports and household consumption. The global economy is slowing and most people are reducing their expenses on essential goods which is leading to less import from other countries. And the most affected sector when there is less consumer spending are the industries, agriculture. and fishery. Almost every central bank are increasing interest rate to curb inflation but it is also affecting the flow of money that would have increased more spending by individuals.

I think the country should seek more markets for its exports and consider reducing interest rates to encourage more household spending.

Recession is recession and technical recession is a term that is creatively used to reduce serious level of recession. If we don't lead our mind misleads by such creative misleading terms, we will know the recession already exists.

Germany witnessed a technical recession months ago (May) and now media is talking about the same in Netherlands.

In fact the whole world are in economic recession, not any single nation has yet witnessed national economic recession.

stagnation and inflation was scary words for a while, let alone stagflation, but in fact, this is what is happening in all countries of the world, the economic performance of the United States, the Federal Reserve continuing to raise interest rates, trade restrictions on China as a whole makes a 0.3% recession not a big problem It is under control or can be removed in the coming years. Some indicators, such as the rise in spending on culture and entertainment, finding alternatives to Russian gas, and the continuation of unemployment at low levels all confirm that it will be a relatively mild recession.

Is it fair to say that large contributing factor to the inflation is the Russia-Ukraine conflict? How much fiat did the Dutch government printed and how much resources they put out so they could send aid? That's probably billions of Euros spent already.

Taken in a macro-economic context, that's probably true. But it could also be the start of a bigger/longer crisis because inflation is still high, and still very "sticky". Plus the president of the European Central Bank, Christine Lagarde, has stated that they still have more hike rates to go to control and curb inflation. That will definitely be more damaging than expected.

Fun fact on Hungary, they also don't have a great history with inflation being subject to the most severe hyperinflation ever documented anywhere. The Pengo (1927-1946) lost 90% of its value in half a week for good. This is also why we love all things bitcoin, it's designed to beat inflation! Insurance.

It is unfortunate how inflation is already invading countries, even the most powerful, such as the United States, a nation that seemed not to go through this type of situation, this wave of decadence and instability is also reaching them. I wonder how much more it will affect this situation to the world, it was predicted that this was going to happen and that the territories would have to experience difficult times, it was never thought that it would be so fast, the currencies are losing stability and the money that is obtained is not enough to cover the basic needs of each citizen, international debts are leading nations to ruin, all because of the bad administration of the country, If only fair and experienced people were in power who did not seek good for themselves but also for the rest of the people, the scenario might have been very different. Now the only thing left is to survive, it will no longer be possible to live comfortably, little by little not even emigrating will be an option to seek a better life, so do not open any nation that is not affected by inflation..... the only thing that could To change this situation would be to seek refuge in technology, digital currencies whose value does not depend on any political event in order to withstand the blow and move forward.

They dont account for inflation properly because it would force up various debt repayment requirements to reflect every price rising and its cost to the countries populations.     If we were so realistic then many countries would have entered recession much more often then realized, its not too surprising to many working people who find problems paying bills while having 2 working adults in the household.    Hundred years ago people had twice the number of kids, half the people employed with an incoming wage yet quite a few faired better then now.  It sure feels like recession to many hence the strike action becoming more common, people are against the wall.

Most famous example I can think of for retrospective revision towards accuracy was the mention that in the 2008 downturn that was not acknowledged till Lehmans in the autumn, actually USA had started a recession the previous year in the summer.   Statistics can be quite stealth in its conclusions.

 This is a bit surprising, considering as their economy seemed to recover quickly from the bite of the coronavirus, experiencing a rapid growth that was faster and stronger than the rest of Europe affected by the pandemic.
The country may be in recession but their labor market is waxing strong, with the rate of unemployment at a record low of 3.6%.
 There are so many factors responsible for this recession and with the war between Russia and Ukraine still ongoing, energy prices have risen sharply as a result.

This only means that even countries like them that has not be critically hit by covid yet they can't skip the effect of global inflation.

But that still helps their country with the services that they give to the people or that's not just enough?

Most countries are bordering on these technical recessions right now, with different quarters dipping in and out. It's maybe more surprising that it has taken so long to reach this point with runaway inflation happening throughout Europe and even the world. The Ukraine war has had a very damaging impact on fuel and food supplies in Europe, but as a richer continent they are probably still fairing great than many other countries. It's nothing to be alarmed about and is fairly mild in the grand scheme of things, as every country goes through this same economic cycle of boom and bust. It's better to accept it than try to constantly fight against it, because recession hits every country on a regular basis.

https://www.dw.com/en/netherlands-dips-into-recession-after-strong-covid-rebound/

A lot of the countries in this world today are facing real recession, not just Netherlands. Countries bordering this region too.
 The impact of war or natural disasters or typhoon on a certain country can cripple its economy, but Netherlands is experiencing none of the stated scenario, except that it has been affected by the Russian -Ukraine war in commerce and trade of crude oil, also other exportable products.
Yes, the pandemic era created alot of remote opportunities and Netherlands did well during the period, also with adaption to technology automation and development.
The country will rebound sooner than expected once new trade alternatives can be explored, as it will be for the other countries affected by unprecedented recession.

LOL.. this is laughable. First of all, countries such as Netherlands were not that much affected by the COVID pandemic. Most of the population got vaccinated before the Delta wave began. It was third world nations such as India and Brazil that got impacted the most. And these countries have shown robust economic growth during the last few years. So what is wrong with Netherlands? The ongoing Russo-Ukrainian war has played its part, but the rot started long back. Many of the European governments still believe that they are super-rich and splurge money on unnecessary expenses. In the end, they are forced to increase taxes and this negatively affects the economy.

In this world anything can happen to a country's economy once their leaders get complacent about certain aspects of it. The Netherlands use to have the one of best economies in the world just some years ago but what is currently happening in the country is the law of supply and demand taking its course. They are currently experiencing one of the worst housing crisis, high inflation rate and rising living cost too. There is just a low supply of housing to match its high demand. Furthermore, their citizens are losing their jobs due to automation and the result as we can see is the "technical recession" which is a negative impact on the growth of the economy. We may likely see them recover before the last quarter of 2023.

The pioneer economic crisis for the world this decade began with COVID-19 pandemic IMO. The economic effect that is going on now has its roots from 2020 when the world almost shut down for the whole year. In fact some countries in Europe stayed back from manufacturing and financial activities. So the world economy is yet to recover from that, the infiltration of wars around only amplified the situation at hand.

I can not agree more with you that now the time is when the economic heroes are shut up. Some time i used to think who are those people who bring the economy of the whole country to this level like back in 20 or 30 years this was not happening like it is now. Maybe i am wrong here. But since i get my consciousness i am evidencing huge jumps in inflation over small period of time.

What's in the world it started is this started when US military left Afghanistan, (i know that's old). Or when Russian war started and BRICS came up somewhere in between and now i just heard there is this mBridge thing to avoid US swift banking system.

Point being made here is, every country is fighting a war not just Russia or Ukraine instead every country is fighting one. We are also in the war with inflation and our country is totally depend on the Dollar because we are under huge debt from many countries but IMF is the one on top of the list. And increasing Interest rates are root problem of all of these things. There must be a balance between these economic situations.

We have to see that Netherland GDP to have been on a dunghill on two consecutive occasions under the circumstance of inflation over two quarters consecutively, there are signals which should have indicated on this coming and yet the government would have taken control measures against recession, we know that almost all part of the world had been affected by inflation this season, but many have managed their way out in avoiding the consequences that could lead to recession, so for now I will possibly admit they are at the brink of recession and if they work against such, it may be averted than then loosing their economy integrity when sunk into recession fully.

A "technical recession" is formally announced when a country's GDP falls for two consecutive quarters. The Dutch GDP fell by -0.4% during the first quarter, followed by another fall of 0.3%, bringing it into a technical recession by the official defintion.

But it's not techncially a recession. It's worse, it's actually Stagflation because inflation is also high sitting at 6.0%. They probably don't want the general public to know what caused the Stagflation and keep blaming it on the "supply side" of things.

https://think.ing.com/snaps/the-netherlands-in-technical-recession/

Another country, Hungary, has also announced to be going through the longest "technical recession".

https://think.ing.com/snaps/longest-technical-recession-on-record-in-hungary/

But like the situation in the Netherlands, Hungary's inflation is very high at 20%. That's true Stagflation - a time when the monetary and economic systems are out of control.