Is Europe All Better Now?

NEW YORK ( TheStreet) -- Ever been in the hospital, wondering if you were going to die, and the doctor comes in to say that while you're sick he thinks you're going to recover?

Europe is like that right now.

The economies of the Eurozone grew by 0.3% in the second quarter of this year, with production of consumer goods leading the way. Most European exchanges rose slightly on the news, and the euro was basically unchanged against the dollar, at $1.32.

You could almost hear the relief across the continent.

Figures released by Eurostat show a wide disparity in growth rates. Countries where austerity has lifted, like Germany, grew their economies. Countries where austerity remains in place, like Greece, continued to contract.

The strength came from the center of the continent, from Germany and France. Germany grew 0.5% over a year ago, France 0.3%, and between them these countries hold 40% of the Eurozone's population.

Spain and Italy, the zone's other two big economies, were down 1.7% and 2%, respectively. Together Germany, France, Spain and Italy represent 74% of the zone's economy, according to Trading Economics.

The best economic performances were turned in by the Baltic countries bordering Russia. Latvia and Lithuania were both up over 4% from a year ago. But the Depression remained in force in Greece and Cyprus, both of which were down over 4% from a year ago.

If you're looking for a comparable number, the U.S. was up 1.4% from a year ago, according to Eurostat's figures.

The German economy seems to be where the economic power lies. The Center for European Economic Research in Mannheim said its ZEW index of economic confidence rose by 5.7% in Germany this month.

Most of the commentary on all this was restrained. Analysts expect continued slow growth with a risk of political instability that could bring on another round of contraction.

No one in Europe is popping the champagne corks, in other words.Except perhaps for bankers.

The zone's 10 biggest banks were all profitable during the first half of the year, and the huge writedowns that marked the heart of the crisis appear to be over.

It all sounds good, but it's not great, and the rifts between the wealthy center and the poorer periphery remain, as do the political issues arising from them.

Every major European country has a political movement that resents the EU and wants to get rid of the euro: England's UKIP, the French National Front, even a German party called Alternative for Germany. Better times mean less support for most such parties -- Alternative for Germany is polling just 2%, according to the latest surveys, with Prime Minster Angela Merkel leading by a wide margin.

You might compare the mood right now to the way you'll feel as the credits start running on a very scary movie, or the way you feel right after a terrible personal crisis has passed. You're not all better, but you can breathe again.

At the time of publication, the author had about 500 shares in Vanguard's European Stock Index Fund, VEURX.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Dana Blankenhorn has been a business journalist since 1978, and a tech reporter since 1982. His specialty has been getting to the future ahead of the crowd, then leaving before success arrived. That meant covering the Internet in 1985, e-commerce in 1994, the Internet of Things in 2005, open source in 2005 and, since 2010, renewable energy. He has written for every medium from newspapers and magazines to Web sites, from books to blogs. He still seeks tomorrow from his Craftsman home in Atlanta.

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