How close is a European double dip?

Inquiring minds investigating the collapse in Europe note Euro-Zone Industrial Production Declines Steeply Industrial production in the 17 countries that use the euro fell sharply in September as weak output across both the core and peripheral economies added to expectations for a poor third quarter gross domestic product print Thursday.

The Netherlands has the 5th largest economy in the eurozone. Home prices are in the midst of a huge plunge notes reader Andrea who is from Italy but now lives in France. Andrea supplied links to articles in the Wall Street Journal and Bloomberg. She writes ... Hi Mish, I just found out that Netherlands are currently experiencing a housing bust after a huge bubble: strange how this has got so little media and blog coverage.

THE crisis in the euro area is beginning to feel like a permanent piece of the world's economic landscape: a great red spot that just churns and churns and never goes away. It isn't, though. One day the crisis will be over, either because the euro zone managed to muddle through or because it didn't, and came apart.

It took Germany's central bank less than a day to knock a reported proposal by the ECB to set interest rates caps on Spanish and Italian bond yields. Bloomberg reports Bundesbank Widens Euro Rift With Criticism of ECB Bond Plan. Germany’s Bundesbank stepped up its criticism of the European Central Bank’s plan to embark on potentially “unlimited” government bond purchases, widening a rift over how to tackle the sovereign debt crisis.

THE judgment of the big credit rating agencies may not carry quite the thunderous resonance it used to, but the steady drumbeat of rich sovereign downgrades nonetheless provides an unpleasant crisis rhythm. On Tuesday, Moody's became the latest agency to revise downward its view of the solidity of European sovereigns.

ALL along, it has been clear that sovereign-debt troubles in Greece, Ireland, and Portugal were primarily a political challenge, rather than an economic challenge, for the euro zone as a whole. Insolvency was and remains a serious issue for these smaller peripheral economies, but because they're small there was no question of Europe's ability to handle the mess, only a question of how costs might be shared.

ECB Says Bond-Buying Program Available The ECB went from loading up on sovereign debt and making a huge mess of it when Greece defaulted, to the LTRO program which has not made a big mess yet but will. Things are about to go full-circle as the ECB threatens once again to make another mess of things with sovereign bond purchases. The Bundesbank, Germany's central bank protested bond purchases the last time (correctly), and will do so again, likely to no avail, and with the same predictable results.