GREcoveryInterrupted: GreekDeflationWorstIn 50 Years
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Attention this week was focused on Europe’s overall (disappointing) 0.7% inflation print – which sent Draghi back to drawing board – despite the world of sell-side strategists exclaiming that Europe has turned the corner and now is the time to load the boat. However, quietly out of sight for the mainstream, Greecejustprinteditsworstdeflation data onrecord. Consumerpricesfell 2.0% on an annual basis as a combination of deep recession, wage cuts, and substantial spare capacity squeeze prices lower. Additionally, we already showed the dismaldemiseofthe macro pictureacrosstheEuropeanunion – heading in a very different direction that the stock markets.. but now,bottom-up, earnings are collapsingtoo… so remind us again why Europe is a "strong buy?"

So EU inflation is slumping despite years of easy policy…

And peripheral deflation is the worst on record…

Top-down, Europe is ugly…

and no bottom-up earnings are collapsing too…

Buy, Strong Buy, Or Buy It All?

Charts: Bloomberg and @Not_Jim_Cramer

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