(8-15-14) Economic decline is occurring in Europe and Asia. For example, the economic statistics weve seen in the last month in the Eurozone economy point to this fact, even as most recently the German GDP has become a red number. French GDP is close to being a red number. Italian GDP is a red number now.
So Europe is clearly sliding back into some sort of recession and the rate at which inflation is falling in Europe, which is down to .4% is a "threshold number," since .5% or one half of one percent annual inflation rate has always been considered a threshold number. It's a threshold number to a pending deflationary cycle.
It should be remembered that the Europeans have already attempted to stimulate their economy. Germany has already tried to stimulate their economy when they put the central bank rate into the red, i.e. a negative interest rate -- but it only went to .1% instead of maybe a minus .25%, which is what Japan had done in the past. Now they're coming up with one of their new reserve operations, which doesn't take place until September.