Europe Sees Biggest Decline in Prosperity Since World War II

While Athens emerged as the center of Europe’s debt crisis, cities across the continent are trying to cope with the biggest decline in prosperity since World War II. A report last week showed that euro-area unemployment rose to the highest in more than 15 years in April and the region’s economy is contracting for the second time in three years.

Voters in France elected Francois Hollande as president May 6 after he pledged to soften austerity measures backed by his predecessor Nicolas Sarkozy, while Greece was thrown into another stage of turmoil after elections split parliament between pro- and anti-bailout parties with no clear winner.

“Before people didn’t see any questions and now they don’t see any answers,” said Austin Hughes, an economist at KBC Bank Ireland in Dublin. “There had been an expectation that incomes, employment prospects and asset prices would improve forever. That certainty is now gone.”More...