French Press Review 20 December 2017

Nothing but 'blue skies' from now on for the French economy. And, beware of those financial bubbles; they always burst.

The state of the French economy and its prospects are front page news in some of today's papers.

The front page lede in the conservative daily le Figaro says "the French economy is riding a wave of optimism," - a major change from the doom and gloom of recent years.

The paper cites evidence that French skies are becoming "more and more blue."

INSEE - that's the national statistics agency - has revised upwards - once again - its estimate of the growth of French GDP this year from 1,8 per cent to 1,9 per cent.

INSEE official Julien Pouget told a news conference the upward trend would continue through mid-2018.

In especially good news - French unemployment is expected to stabilise at around 9.4 percent by mid-2018, its lowest level since early 2012.

Joblessness was a constant thorn in the side for P resident Emmanuel Macron's Socialist predecessor François Hollande - who failed to shift
unemployment much below 10 per cent during his single term in the Elysée palace.

"The pace remains intense," says le Figaro. "The government is delighted to have completed the reforming the Labour Code in record time at the end of September."

Among other things - the changes will make easier the hiring and firing of employees - a move the paper supports wholeheartedly.

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The financial paper les Echos celebrates the news on the economy - noting that "The morale of business leaders is the highest in 10 years."

However, the paper cautions that it's not all sunshine and blue skies.

INSEE identifies a black spot, the paper says - a cloud on the horizon, if you prefer - bottlenecks in the French economy.

For the first time in a decade, businesses are reporting supply problems, including recruitment, rather than demand constraints.

"These difficulties are general, since the crisis led to business bankruptcies and an explosion in long-term unemployment, making some people more difficult to employ.

"This is perhaps the problem in the years to come."

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Centrist le Monde also gives front page prominence to an economic story - albeit of a different hue.

"The Bitcoin revolution is shaking the financial world," the paper declares.

It is perhaps the biggest economic surprise of 2017, the paper says.

Unknown to the general public three years ago, bitcoin has just made a sensational debut on the international financial scene.

On Monday, le Monde tells us, the Chicago Mercantile Exchange launched cryptocurrency futures. And that's just the beginning.

Bitcoins were valued at 1 000 dollars - around 850 euros - at the beginning of the year. By Monday they were close to 19 000 dollars Monday - that's 16,000 euro.

In the universe of low interest rates, where nothing pays, investment funds flock to it; start-ups raise funding using cryptocurrencies; even individuals, bewitched by the surge of prices, buy them.

"This "bitcoinmania" raises concern," the paper says.

Nobel Prize winning economists call it a dangerous "bubble".

"Those who join the adventure risk losing everything if the bubble bursts," warns le Monde.

Not for the first time.

There was the Dutch Tulip Bubble in the 17th century, the South Sea Bubble in the 18th, and, more recently, Japan's real estate and stock market Bubble in the 1980s; the Dot-Com Bubble in the 1990s: and the US Housing Bubble up to 2006.

Needless to say - all those bubbles burst.

"Those who cannot remember the past are condemned to repeat it,"  as the philosopher George Santayana observed.

Le Monde might have added - if it seems to good to be true - it probably is.