Europe needs upturn in domestic demand

In recent years the European economy has been dragged from its slumber by strong global growth and not by domestic demand. While the entire stockmarket has done well, equity investors have been extremely well rewarded for taking a "pro-cyclical" or "pro-global growth" stance. Industrials, in particular, have been spectacular performers. This performance has followed as more and more market participants started to recognise the buying power of the developing economies, a view that is now well established. So what is the outlook on growth? We are in a peculiar situation where the developed ...