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Interest rates, deflated by the présent and forecast price changes, are very high, compared with the average of the last thirty years. Will that last ? If so, will the recovery be impeded ? What part can each économie agent play in such a context ? Enlightening thèse issues brings us to see how interest rates and growth rates are linked from both opposite angles, the long and the short run.
In the long run théories based on the assumption of rational behaviour lead to identical interest and growth rates, when a equilibrated growth is reached. Sustaining the highest level of activity implies investing the exact amount of national income that returns to capital.
Real interest rates hâve actually been under growth rates, for the invest-ment has been more and more financed by monetary expansion. But shortage of capital and under-utilization took place at the same time, and unemployment appeared to stay. Still a sustained potential growth and consequently high real interest rates are allowed by the pending technical progress, providing that free compétition be restored.
In the short run both real interest rates and activity fluctuate. During the présent business cycle, the stage has not been reached where an inflation upsurge makes them fall.
In the United States, short term interest rates skyrocketed, and then financial markets became more attractive, with the policy mix of budgetary impulse and monetary restraint. The building up of public déficits stands in the way of a sharp decrease of long rates.
A way to secure a soft landing of the economy would be to combine cuts in american déficits with a more buoyant activity in Japan and Europe in a relatively strict monetary context.

That oil production should currently be concentrated in the least cost-effective areas is a paradox which reveals the fragility of OPEC's price monopoly. The explanation lies in poorer prospects for growth, the emergence of new producers and the financial difficulties of some members of the cartel. Unless OPEC's prices are re-aligned on the production costs of competitors, its market share wMI inevitably shrink given current prospects of stagnation in oil consumption up to the year 2 000. However, OPEC remains the arbiter of supply in the short term. The London agreement showed that a massive reduction of stocks can be absorbed with only a limited fall in prices, leaving room for a subsequent strengthening of the market. In the future, a short-term instability of prices could therefore be combined with a long-term fall.

Le récent relèvement des quotas de production de l'OPEP n'a pas suffi à faire baisser les prix du pétrole. Aveuglés par des niveaux de stocks particulièrement bas dans l'OCDE, surtout en cette période de l'année, les marchés restent extrêmement volatils, car soumis aux difficultés d'approvisionnement sur certains produits raffinés. Néanmoins, la politique des « petits pas » de l'OPEP devrait favoriser une détente des prix dès le début de l'année prochaine, mais vers des niveaux élevés (.).

Le récent relèvement des quotas de production de l'OPEP n'a pas suffi à faire baisser les prix du pétrole. Aveuglés par des niveaux de stocks particulièrement bas dans l'OCDE, surtout en cette période de l'année, les marchés restent extrêmement volatils, car soumis aux difficultés d'approvisionnement sur certains produits raffinés. Néanmoins, la politique des « petits pas » de l'OPEP devrait favoriser une détente des prix dès le début de l'année prochaine, mais vers des niveaux élevés (.).

Genesis of Cyclical Indicators, and their Maturation in the United States Philippe Sigogne, Véronique Riches Economic fluctuations were born with the Economy. Acknowledged since millenaries, they were considered as fatalities during all the preindustrial era, on account of a predominating agriculture. Prices, some wages, and interest rates were long the mere elements recorded with some steadiness. Materials required forgauging real fluctuations appeared only with the development of manufactures and wage earners. The flow of economic theories has also mirrored the evolution of economic structures. Quite often did the economists lack long term statistical data to build tentative explanations. Midway through the XIXth century endogenous crises of capitalism were pointed out ; at the end of the century the emphasis was on swings around the equilibrium. Fluctuations are then classified according to their duration and analysed as departures from and return to short and long term equilibrium. The Great Depression of the thirties put an end to a first generation of cyclical indicators, guilty of misanticipating the crisis. By opposition the new researches did exclude any theoretical a priori. The American NBER worked out a systematic analysis of existing statistics using a basically empirical definition of cycles. The idea of business cycles has stood unchanged for more than fifty years. It allowed for a hardly questionable dating of reference cycles, then a selection of indicators well conforming with business cycles. Their first list goes back to 1 937. Simultaneously a diffusion measure of the cyclical process, sort of forerunner of business surveys, was elaborated. Publishing of cyclical indicators begins with the sixties. It popularizes the words of advanced, coincident and lagging indicators, then in 1 968 this of composite index. This last one has achieved a mediatic success that prejudices its reputation, as many users take it as a convenient way of mechanical forecasting. Actually cyclical indicators must be handled as a system where composite indexes, diffusion indexes and data exogenous to the business sector cohabit. The system of indicators has ratified the improvement of statistics, through its successive updatings. It forms not only a complete set of business monitoring instuments but also sums up the main sequences of private economic doings. Besides it stands apparently well to structural change induced by a rising tertiary sector.

Elements for an Endogenous Approach of Recessions and Revivals Jacques Adda, Philippe Sigogne Today cycles are most frequently assumed to be the outcome of the propagation of exogenous shocks through the economic system. We assume here alternatively that cycles are primarily due to the natural instability of market economies. Far from generating cyclical fluctuations exogenous shocks would rather alter their regularity. The purpose of this work is to grasp the working of turning phases : recessions and revivals. The study is twofold. First the main non exogenous variables are compared to the reference - cycles of two economies, for the period 1 972-1 991 : the United States and the United Kingdom. Then an endogenous dynamic process of business cycles is propounded, based upon the interaction of physical tensions, conflicts of income distribution and financial tensions. The analysis phase stresses the role of productive investment as the main vector of the amplitude of fluctuations, though not the usual trigger of turning points. Economic agents behave without knowing ex ante the best path of growth, which is accordingly tested through successive trials. The piling up of physical capital follows a self-sustained process as long as shortages are not strongly felt. The increasing saturation induces the recession when some actors can no longer bid up to obtain the rarefied inputs, physical or financial. Similarly the drop of activity cushions itself as it makes solvent more and more potential buyers. Macroeconomic turning phases are thus built on disparities of microeconomic situations. The saving behaviour of households looks essential to the understanding of these turning phases. The rise of nominal savings during the saturation phase goes along with a falling volume of residential investment, which underlines the role plaid by relative price distorsions of capital and labour at both turning points of the cycle. Broadly speaking, too much value locked in capital goods triggers the downturn. Symmetrically the capital losses of less reproductible assets are a prerequisite of any revival of current operations.

Economic growth slowed down after the sharp recovery of 1983-1984 and has remained sluggish over the past two years. Now that it is well advanced, the present business cycle does not look very dynamic. An upsurge of inflation has been prevented so far, but both fiscal and foreign deficits have increased so much that they now seem to call for transient and dangerous half-remedies : protectionism, arbitrary freeze of federal spending.
The fall of oil prices does have positive effects on the economy, for in the United States as elsewhere it has enabled interest rates to decline and household's purchasing power to increase. Housing and private consumption will therefore fuel economic growth this year.
In 1987, budgetary cuts will hamper economic activity and lower the public deficit, but not enough to stop the rise of the debt/Gnp ratio. Private investment, which is already falling in the energy sector, would become even less profitable should the fiscal reform be implemented. It might stay at the present level only if interest rates were to decline further.
Despite the recent surge in equipment expenditures, american competitiveness has not fully recovered. Productivity has not increased rapidly enough in the sectors where competition is fierce. The decline of the dollar is not ample enough to enable by itself the current balance to improve significantly.
Having reached such a situation, the United States now rely upon other developped countries to pull their own growth through accelerating exports. The alternative to stronger international competition is another fall in the exchange rate of the dollar.

Depuis le début des années 1980 les excédents commerciaux japonais sont spectaculaires, mais aussi leurs emprunts à l'étranger ; tandis que l'excès d'épargne intérieure sur l'investissement provoque des sorties massives de capitaux. Ce qui fait du Japon une plaque tournante non seulement commerciale, mais aussi financière. Le rapide développement de l'économie a bénéficié d'une démographie favorable depuis la deuxième guerre mondiale. L'émergence de nouvelles activités et les chocs pétroliers ont suscité des restructurations répétées. Celles-ci ont permis d'enrayer le laminage des profits, renforçant la mainmise de l'industrie sur l'économie. Engagés dans une phase de rattrapage des pays les plus riches, les Japonais ont payé l'intense effort de modernisation par une pause des salaires réels depuis dix ans et un surcroît d'épargne. Leur consommation n'est pas à la mesure de leur travail. Le passage, au milieu des années 1970, d'un endettement des entreprises à celui de l'Etat a favorisé l'éclosion de nouveaux marchés financiers et rendu moins efficace le contrôle direct de la liquidité. La régulation par les taux d'intérêt est privilégiée depuis 1980. L'internationalisation du yen pourrait la remettre en cause. Le freinage des dépenses publiques amorcé en 1980 et la privatisation d'entreprises publiques déficitaires se heurtent à des limites ; mais la faiblesse de la pression fiscale laisse une marge de manœuvre. Depuis 1983 la reprise américaine a permis aux entreprises japonaises de hautes technologies de développer massivement leurs exportations, et a amplifié la vague de modernisation. La production industrielle s'est acrrue de 20 %. En dépit de l'amélioration de l'emploi, la croissance du pouvoir d'achat a été lente et la consommation n'a progressé que de 6 % en deux ans. Le redressement des profits a restauré la confiance des entrepreneurs. L'investissement prendra le relais des exportations, permettant de maintenir un rythme de croissance de 5 à 6 % jusqu'en 1986. A plus long terme le Japon aura à faire face aux difficultés nées de ses excédents commerciaux, engendrés par son goût de l'épargne et de la compétition, et, d'autre part, au vieillissement de sa population.

Structural problems, worsened by the oil shocks, called during the 70's for adjustments that made some degree of recession necessary. But all through the decade, economic policies followed in industrialised countries enabled economic agents to avoid these necessities by increasingly resorting to debt. These policies have gradually become restrictive during the recent years, enabling postponed adjustments to take place. This process is well under way, so that the factors of recession will probably fade away in the coming months ; but there is no reason why they should turn into stimulus for growth. Unless new, dynamic factors suddenly appear, no recovery can be expected in France's foreign environment in 1983. The results of France's expansionary policies in 1981 and of the shift of june 1982 can now be assessed. Household income increased noticeably and then faltered for a while. Employment suffered no important decline as industrial production remained flat and productivity slowly increased. But the trade gap widened, and presently reaches an annual rate of 80 billion francs. As long as a worldwide recovery was expected in the near future, the resulting indebtedness appeared as a temporary nuisance. But it can no longer be considered as such when in most foreign countries economic policies still focus on structural adjustment, nor be acceptable as the price for lonely growth. Should restrictive demand management be used as the only way to curb the trade gap, then industrial production would register a 5 to 10% decline.

European economies have been diversely hit by the shocks of the past ten years owing to structural differences. Initial reactions resulted in a great variety of economic policies. More recently, external constraints have induced adjustment policies in all countries. The process is unevenly underway, so that economic growth can not yet resume everywhere. Signs of recovery will strengthen during the second half of 1983, but no real generalised recovery can be expected in Europe before mid-1984. In the early 1970's, France experienced particularly fast growth whose driving forces were household consumption and residential building. More recently, the latter has been severely hit by the economic crisis. As it declines, so does a powerful incentive to save. As savings are not completely reoriented towards financial assets, the fall of consumption is limited. Export competitiveness calls for a balanced judgment : it is neither good nor bad but, rather, slowly improving. Although market shares are slightly increasing, exports are weak because world demand is contracting at a pace often underestimated. The trade deficit will not vanish with a recovery abroad, but it could very well be halved in a year's time.

Western economies have been undergoing a recession over the past two years. Though in a more favourable cyclical phase when hit by a second oil shock, less severe than the first, they had been structurally weakened. Moreover, international competition was more fierce while there was less scope for adaptation in policy. The recession now seems to be bottoming out. A fall in interest rates will allow activity to pick up slowly in the United States, though it might rekindle inflation. The depreciation of the Dollar against the Deutschmark which will probably ensue, would loosen restrictions on European economic policies. Any resulting upturn in activity will however be moderate, strong growth in world imports being unlikely since demand from non-industrialised countries will fall off. French performance in reaction to the external shocks of the seventies compares poorly with that of partner countries. The squeeze on profits which had followed the first oil crisis was reinforced by the second. Up to spring 1981, tight fiscal policy accentuated the sluggishness of activity. Compared with other countries, a less restrictive monetary stance enabled firms to use a greater degree of external funding. The new policy, implemented from mid-1981 onwards, has slightly increased personal incomes and thereby consumer spending. However, despite improvements in activity and profitability, firms have reduced their investment levels. In the absence of better growth prospects, these are unlikely to rise in the coming months, particularly if external circumstances necessitate continued high interest rates while inflation remains higher than in other industrialised countries.

It seems that we have reached the trough of the recession. None the less, a revival of world economic activity can hardly be expected in the coming months. Owing to the financial adjustments undertaken in many countries, the ground lost over recent months will only be recovered slowly. Moreover, economic policies must remain tight in the face of fierce competition on sluggish world markets. Domestic demand in OECD countries is therefore unlikely to be buoyant while the austerity imposed on developing countries will continue to curb their imports. France is particularly handicapped by present exchange rates which simultaneously increase the cost of imports and reduce competitivity. Economic policy has recently moved towards redressing certain weaknesses in the structure of foreign trade brought to light by the devaluation in June. The rise in production costs has been stemmed and the freezing of both prices and incomes should prevent any sudden worsening of the financial difficulties of the corporate sector. Recently adopted measures should rectify the pattern of income distribution and reduce the foreign trade deficit, though activity may suffer. However, in the present environment, the end result is more likely to be a breathing-space than a return to full industrial competitivity.

Pourquoi publier, en 1993, un ouvrage sur les cycles économiques ? Posée il y a seulement cinq ans une telle question valait à peine ďêtre débattue. Dans de nombreux pays la croissance paraissait alors s'être durablement installée ; le contre-choc pétrolier marquait la fin des turbulences qui avaient fait dévier l'économie mondiale de son sentier de croissance équilibrée. L'idée ressurgissait qu'une politique économique rationnelle, associée à une coopération internationale bien comprise, permettrait ďanticiper les écarts de comportements et de prévoir tout dérapage. (Premier paragraphe)

Pourquoi publier, en 1993, un ouvrage sur les cycles économiques ? Posée il y a seulement cinq ans une telle question valait à peine ďêtre débattue. Dans de nombreux pays la croissance paraissait alors s'être durablement installée ; le contre-choc pétrolier marquait la fin des turbulences qui avaient fait dévier l'économie mondiale de son sentier de croissance équilibrée. L'idée ressurgissait qu'une politique économique rationnelle, associée à une coopération internationale bien comprise, permettrait ďanticiper les écarts de comportements et de prévoir tout dérapage. (Premier paragraphe)