(edit title) Sweden Under Pressure To Cut Growth Forecasts Why the delays? (Wall street journal) Options

[byke]

As we have all seen in the past few days, the swedish economy isn't doing as well as it could be.
But I got a kick out of this report today that seemed to show Finance Minister, purposely dragging his feet in regards to forecast growth due to the knock on effect it could have for his party.

Either way, worth a read.

http://online.wsj.com/article/SB1000142412...=googlenews_wsj

[Great Scott]

It’s been known for a long time now that the so called “Sweden’s doing well” has been nothing but a myth made up by the current government. It seems however that they have now been cornered and don’t know which way to turn. If you live outside of Stockholm, Sweden is a very different place. Companies have closed at an alarming rate resulting in a huge rise in unemployment especially for the under 25’s. The government have put thousands into Fas 3 to try and hide these figures and the youth and taking up studying to avoid Fas 3 but even with all of this the figures keep rising.
I am sure someone is going to say “We have it good compared to Greece and Spain”, countries that have very low taxes. It is Sweden’s high taxes that are keeping it afloat, but with less revenue due to high unemployment things will change, and I am sure the government will pull out its “Get out jail card” and blame the Eurozone for the problems once again. However there is a glimmer of hope for the government as the Eurozone has recently fallen back into recession by 0.01%. The government is also cornered when it comes to the value of the kronor, the Swedish bank want to increase interest rates to devalue the kronor making Swedish goods cheaper, but no the government wants to keep the Kronor high in order to try and impress the Swedish population and show that Sweden is doing well. Of course this is yet another myth.

[byke]

http://uk.reuters.com/article/2012/11/17/u...E8AG07E20121117

http://au.news.yahoo.com/world/a/-/world/1...rowth-forecast/

[Hisingen]

You financial experts ought to be advising the government, since you, and the media, seem to know so much better.

[gplusa]

Yes, 2 pearls of wisdom. One from a poster with so many personas that he needs to label his socks to remember who he is, and the other from a poster who has never been to Sweden and is still pissed about getting rejected for a job 5 years ago. True gems of enlightenment.

Or maybe I'm underestimating one of them.

[byke]

#Bunker_mentality

[Mib]

@Great Scott...probably a blonde moment, but if you want to devalue your currency, one tends to reduce the interest rate. However othe factors come into play, that investors place their moneu in currencies that are viewed safer than say the Euro, Sterling etc. Also, I know of no Government who wants higher interest rates as it makes their currency stronger, which for an export driven economy is not a great idea. Although buying in fuel and other essentials are cheaper as a result. I do believe that rates are set independently from Government.

I work for a Swedish based company and they have acknowledged tve challenges aceoss Sweden and also the impact of the Euro recession on its own customers. However, they are driving through changes to be more innovative etc to get us and the customers through a challenging period which all started in 2008! Thankfully, we have not had any forced redundancies and have taken on people in specific areas to grow the business. This business has exposure throughout the whole of Sweden, so I would say that it shows some of the reality in Sweden today.

Every country including Sweden manipulate their figures...so nothing new there. It's a result of people voting in the traditional parties again and again, whether they're left or right. Same sh*t.

[organic225]

Mib is correct about lowering interest rates tends to lead to a devaluation of the currency.

In general, debates about economic policy ring hollow to me. Whatever policies are adopted anywhere in the world are done to benefit the bankers and ultra wealthy, the folks who essentially pay no tax anyways since they know all the loopholes and how to stash their money.

[Yorkshireman]

Companies have closed at an alarming rate resulting in a huge rise in unemployment especially for the under 25's. The government have put thousands into Fas 3 to try and h ... (show full quote)

Companies have closed at an alarming rate resulting in a huge rise in unemployment especially for the under 25's. The government have put thousands into Fas 3 to try and hide these figures and the youth and taking up studying to avoid Fas 3 but even with all of this the figures keep rising. ... (hide full quote)

Sweden has had a Youth Unemployment problem since the 90's, each successive Government has blamed the previous one for not tackling it, it was not caused by the current economic downturn. As for education, well, again ... Sweden's statistics, when compared to other countries, with regards Youths in education has also been distorted for a long time, always shows a much higher figure of youth education vs unemployment, when compared to other countries, the reason being that in many countries eg. UK, you can leave school (education) at 16, in Sweden You do not, though many EU countries are aligning over the years by raising the leaving age to 18. And the training-for-profession (yrkesutbildning) distorts the real data.

Of-course with 50%+ of GDP coming from exports there will be impact from teh Euro-zone troubles, it raises it head now especially as large companies have just been preparing 2013 budgets and forecasts, and since it takes time to negotiate with Unions plus notice-periods etc... they have to give warnings now, for jobs that are expected to be cut during next years. And by law employers have to warn Arbetsförmedlingen with a certain period notice depending upon the number expected to lose their jobs. 2 months for 5-25, 4 months for 26-100 and 6 months for 101+

Whilst many redundancies come from economic difficulties, you also must remember that often companies use the situation to cover additional restructuring moves to move jobs to low cost countries. During 2008, France even passed a special law forbidding that!, if it looked too much like a restructuring to low cost country rather than due to economic downturn!