It’s Good To Be The German

In case you didn’t know it, Germans are sitting on a big honking tremendous pile of money.

The Bundesbank thinks that German private households are in posession of ein paar tausend Milliarden or “a few thousand billion” euros (stick with that, believe me: Billion is Milliarde in German, trillion is Billion). They’ve got more set aside now then ever before, in other words; some 4.7 trillion euros.

And the punch line is that they seem to have invested most of it at those awful horrible dreadful banks they like to despise so much (they make big banks even bigger, you might say). Investments in real estate haven’t even been calculated here, by the way. Rereading this is starting to make my stomach hurt.

Privatleute vertrauen Vermögen den Banken an.

One response

  1. That’s alright, because they see the Eure trending into devaluation for some period of time. That actually bodes well for the New York Exchanges at first (buying US stocks is a way of swapping your savings out into another currency,) as well as an eventual round of bargain-hunting on the European exchanges after a pullback of, say, 8-10%

    One of the pressing problems with all economies, even the German economy, is that a large amount of money has been pulled out of markets, and has still not gone back in. This starves companies that hire, build plant, or otherwise invest, of operating capital.

    One certainty is that when the fear DOES go away, stock prices (and volumes) will rapidly rise in a large, one-time Oklahoma-landrush style event.

    After all there has been an awful lot of money that has been held back since 2009. People have watched their retirement accounts fall and eke back something, but are likely exactly where they were 4 years ago. There’s anxiety about this having cost/lost time in the scale of years that they will have to keep working beyond the age that they had once anticipated.

    Retire at 68-70? The economy has made that decision for us, despite the knuckleheads frequently found marching in the streets of French cities on a seasonal basis trying to circumvent fiscal reality by “making a debate” out of it.

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