Europe's GDP shrinks, still too dependent on the US

What to make of the latest European data confirming a recession in the euro-zone? The increasing likelihood that this will be an atypical and long recession, with characteristics unique to this era.

The euro-zone's economy contracted -1.6 percent in Q4 2008, Eurostat announced Tuesday (pdf). That's -0.2 percentage points worse than the previously announced estimate, and the region's worst GDP contraction in at least 13 years, the E.U.'s Luxembourg statistics office said. For all of 2008, the euro-zone economy grew just 0.8 percent, after recording an impressive 2.6 percent growth rate in 2007. In Q4 2008, Germany's economy contracted -2.1 percent; France, -1.1 percent; Italy, -1.9 percent; and Spain, -1.0 percent.