The first quarter of 2016 is finishing in a much better situation than it has started. Invalidating, once more, analysis and forecasts of most of economists, the world has not been hurt by the failure of a major country, having consequences outside of its borders. There were no recessions among large developed economies and growth went on, only at a slower rhythm than it would be necessary to reduce disequilibrium caused by the 2007-2008 crisis, unemployment for some of them, excessive indebtedness for the others.

Chinese economy is following its path. Shanghai Stock Exchange is regaining, day after day, the lost ground and has stepped over the symbolic level of 3000. The correction of excessive speculation has been severe. Intervention attempts by the authorities have been awkward and have contributed to increase market volatility but lessons seem to have been learnt. Yuan is now stable and its parity, compared not only with the dollar but with other major currencies, has been, at the end, slightly modified. Interventions on exchanges markets seem to have come to an end. Unambiguous declarations by the Governor of China People Bank, Zhou Xiaochuan have been convincing: the government was not preparing a “currency war”. But he sent a warning to Chinese firms which launched a frenetic wave of acquisitions abroad since the beginning of the year, evaluated at more than 100 billions dollars, taking advantage of the fall of stocks markets. 13rd plan divulgation, the roadmap of the country for the coming years, has also contributed to calm worries. Chinese economy structure will change. Its growth target will be between 6.5 and 7%. Qualified by some as the “weakest since thirty years”, this growth would constitute a remarkable achievement due to the size the Chinese economy has reached, and would still exercise a dragging effect on the world economy.

On the American side, it is also continuity. Problems are still there, the twin deficit, foreign and public sector, especially if local authorities are taken into account with their record 3 700 billions dollars level of debts, saving rates are too low and private indebtedness reached a record. It is now focused on young generations with credits contracted to finance their studies, they have to reimburse and on firms which have not constituted enough reserves to finance pension schemes. It is a “time bomb”. Another destabilizing factor is the very important rise of inequalities since the crisis. But, unlike Europe, it is not felt in the U.S. as a handicap, but as an element of the “American dream”. And that hasn’t the political consequences we could imagine here, as Donald Trump popularity testifies. So this general situation doesn’t worry monetary authorities. Wisely, The Federal Reserve postponed any significant tightening of its policy. Some months ago, the same attitude had triggered a wave of worries and a fall at Wall Street. Economists interpreted it as the result of the doubts about the health of the American economy. The following events showed that it was not the case. Growth is not flashing but the economy is creating jobs at a sufficient level without generating inflationist pressures. So a significant tightening is not necessary. And the stock market has understood it. The dollar has stopped its ascension and the Dow Jones has regained the level of the beginning of this year and has erased the 15% fall which occurred in the mean time.

Europe, also, is not so bad. It could do much better, obviously, which explains the growing disaffection it is facing with people. German local elections in March, in three Landers, gave us once more, a proof of it. But the catastrophic message of these previous years has no more reasons to be there. Countries which had been the most hurt by the crisis, Spain, Portugal and Ireland, are recovering. That said, any comparison with the countries which had resisted, as France and Germany, are irrelevant, notably as growth and employment are concerned. Our welfare systems, which are criticized by some, even among those who claim they belong to the left, have played the role of efficient social shocks absorber. The “reforms” achieved in the countries which were the most hardly affected, through massive public money transfers, have permitted to repair the wrongdoings, notably in the banking and real estate sectors, which sent these countries near bankruptcy. But they are not an example to follow. They just correct special situations. Any adaptation to France, for example, is pure political game.

French economy also starts to feel a little better. After four years of quasi-stagnation, a growth rate above 1%, as it is expected in 2016, is definitely good news. But there is no reason to crow about. It won’t be enough to significantly reduce unemployment and, compared with past results, in a favorable international environment, this result will be, by far, under what we could expect. Regarding the other objective of the government, the improvement of the competitiveness, it is far for being achieved. Industrial foreign trade in spite of the fall of the euro is still heavily in deficit, contrary to the situation in Germany, of course, and also in Italy. And the rebound of investment is modest compared to what it was possible to expect with the fiscal transfers offered for the last three years and with near zero interest rates.

Consumption and real estate transactions take more advantage of it. The new trend in favor of renting cars instead of buying them is the consequence of the diminution of interest rates. But it profits almost equally to foreign made vehicles. Consumers seem to have not yet understood that they are the real actors, as far as employment is concerned, instead of the government. The trade deficit of the car industry increased again in 2015. At the opposite, the debates causing anxiety about safety or the diminution of jobs protections are definitely doing nothing to stimulate household behaviors. The housing sector is doing, at last, a little better, thanks to the development of social constructions. The offer of lands belonging to the State and to local authorities starts to have some effects. But the substantial rise of the real estate loans should not give any illusion. It mainly results of the renegotiation of current loans in order to profit from the reduction of interest rates. But it is good for the purchasing power of the borrowers.

At the end, and even if economic risks and political crisis all around the world have not disappeared since the beginning of the year, the very negative anticipations made have been invalidated by the facts. The theory of the verified anticipations which proclaims that forecasts are always self-verified has been put in doubt. We expect, at the opposite, with optimistic forecasts, to test if the opposite is true.