Category Archives: Heconomy

Debt Expert Deutschland

June 22, 2011 By in Heconomy, History, Hypocrisy Tags: , , , , , , , , , , 1 Comment

SPIEGEL ONLINE: Mr. Ritschl, Germany is coming across like a know-it-all in the debate over aid for Greece. Berlin is intransigent and is demanding obedience from Athens. Is this attitude justified?

Ritschl: No, there is no basis for it.

SPIEGEL ONLINE: Most Germans would likely disagree.

Ritschl: That may be, but during the 20th century, Germany was responsible for what were the biggest national bankruptcies in recent history. It is only thanks to the United States, which sacrificed vast amounts of money after both World War I and World War II, that Germany is financially stable today and holds the status of Europe’s headmaster. That fact, unfortunately, often seems to be forgotten.

SPIEGEL ONLINE: What happened back then exactly?

Ritschl: From 1924 to 1929, the Weimar Republic lived on credit and even borrowed the money it needed for its World War I reparations payments from America. This credit pyramid collapsed during the economic crisis of 1931. The money was gone, the damage to the United States enormous, the effect on the global economy devastating.

SPIEGEL ONLINE: The situation after World War II was similar.

Ritschl: But right afterwards, America immediately took steps to ensure there wouldn’t be a repeat of high reparations demands made on Germany. With only a few exceptions, all such demands were put on the backburner until Germany’s future reunification. For Germany, that was a life-saving gesture, and it was the actual financial basis of the Wirtschaftswunder, or economic miracle (that began in the 1950s). But it also meant that the victims of the German occupation in Europe also had to forgo reparations, including the Greeks.

“He warns the country should take a more chaste approach in the euro crisis or it could face renewed demands for World War II reparations.”

A Country Named Sue

June 14, 2011 By in Habeas Corpus, Habitudes, Heconomy, Hurt Feelings, Hypocrisy, Hysteria Tags: , , , , , , , , , 4 Comments

You sue, I sue, we all do (sue). And here I thought Germany was the land of Konsens (consensus – not common sense). At least when it comes to doing this nuclear phaseout thang, I mean. Fooled again.

OK, it is logical and predictable that Germany’s power companies now have hurt feelings and are preparing to take legal action against the government’s decision to shut down their nuclear power plants because, well, the government is shutting down their nuclear power plants.

But what about all the thousands of lawsuits being prepared by power-line, wind energy and other regional resistance group apponents the nation over set to flood the lawsuit market once these big honkin’ power-line thingies start going up? You know, the power-lines that will transport the good offshore wind farm energy from the north to the bad industrial south?

Why can’t we (as in you) learn to live together in simple peace and harmony? Now that the nuclear power dragon has finally been slain, I mean. Come on, folks. Join hands, form a circle, sit down and talk.

Specifically, they will invoke Article 14 of the German constitution, which addresses the question of whether the companies’ assets are being expropriated, and if they are therefore entitled to compensation. After that, the amount of compensation would be negotiated in civil courts. According to internal calculations, the industry envisions a potential sum of €20 billion ($29 billion). The burden would ultimately fall on taxpayers.

“Frau am Steuer…das wird teuer!”

June 12, 2011 By in Heconomy, Hysteria Tags: , , , , , , , , , 2 Comments

“A woman at the wheel, that’ll cost you!”

Who would have thought that? According to Germany’s Federal Agency for Electricity, the German electricity grid is in a thoroughly chaotic condition these days. No one can explain why. And the cost of purchasing needed electricity (nuclear generated) at the European Energy Exchange has already gone up 10 percent and further increases are expected to follow soon. It’s bizarre. It’s almost as if some crazy person had shut down eight nuclear power plants here or something.

Yup, Angie Merkel’s Fukushima-driven German angst Atomaustieg (nuclear phase-out) may have indeed been absolutely necessary and of critical urgency (opinion polls, folks, you gots to give the people what they want), but hysteria does have its price. Even in Germany, I mean. But who cares? I know the Germans pretty well and I am convinced that they are all going to be more than willing to pay radically higher electricity bills in order to avoid the, uh, tsunami threat on the home front.

What I really don’t understand is the economics at play here. There is clearly an overabundance of hysteria in this country, right? Shouldn’t that make the price of hysteria, like, cheaper or something? I’d ask an economist but you know how the adage goes: For every economist there is an equal and opposite economist.

“Das Bundeskartellamt erwartet als Folge des Atomausstiegs steigende Strompreise. An der Strombörse sind die Preise bereits um zehn Prozent gestiegen.”

Über Euro Über Alles?

June 10, 2011 By in Heconomy Tags: , , , , , , , , , 2 Comments

Time for a new European currency yet?

“The real threat to the euro isn’t that a weak peripheral country like Greece might withdraw in an effort to devalue its way to competitiveness, but rather that Germany might want to pull out.”

This guy makes a very interesting point. He goes into what he defines as the three main problems that have led Greece, Portugal, Ireland and Spain (not yet, but soon) to the dismal position they are now in and suggests that because of the coming bailout fatique, the only way to save the union is, well, to divide it. This could best be done by introducing an Über Euro in the non-bailout nations.

“Germany’s incentive to leave grows with each bailout, and Berlin could ultimately make a simple calculation that extrication will be less costly than continuing the sacrifice needed to keep the euro.”

To avoid this, one could strike a grand bargain by creating this new currency. “These nations then announce that all obligations between their citizens will henceforth be denominated in the new currency, the Über Euro, which would eventually be managed by the Bundesbank. The Über Euro would initially be set at a value of perhaps 1.3 euros, setting the stage for an export boom for countries that continue to use the euro. This would allow the remaining eurozone members to restore their competitiveness without having their financial systems go bankrupt; it also would allow Germany to sell the plan as saving Europe without breaking up the EU.”

“Should the remaining euro countries continue irresponsible fiscal policies, the European Central Bank (which would continue to be their central bank), would slowly monetize their debt. The euro would continue to depreciate against the Über Euro and perhaps end up as junk currency. …The ECB’s stature would be diminished and its balance sheet probably trashed.”

Sounds like a good plan to me (for world domination?). But I’m not very good with money, either.

There is no inherent reason the European project cannot proceed with two currencies and the citizenry may force this outcome.

PS: Beware, Greece. As the Wall Street Journal puts it, there’s a Wolfgang at your door.

Germans Meant “Work Harder”

June 5, 2011 By in Hard Facts, Heconomy, Hypocrisy Tags: , , , , , , , , , , 2 Comments

Down south (in battling the Greek debt crisis, for instance). Not longer. A study based on OECD and Eurostat figures has determined that Germans work less annually than their no good and lazy Southern European neighbors.

The study indicates that “a German’s average annual work duration (1,390 hours) was substantially lower than for a Greek (2,119), an Italian (1,773) a Portuguese (1,719) and a Spaniard (1,654).”

But at least for that the Germans work more intensely, right? Not according to that study, they don’t.

But at least they mean well, or something?

“Germany’s productivity per head remains close to the average of southern European countries. Its hourly productivity rate is above average but not better than France or Greece,”

German (Carbon) Footprints in The Sand

June 2, 2011 By in Heconomy, Hypocrisy, Hysteria Tags: , , , , , , , , , , , 2 Comments

What are we cheering about again? (This is another one of those Green Shirt terror posts.)

In a democracy, you can say A, but you can also say B, just as you can rely on the assumption that nothing has to last forever. Everything can be changed, amended, courses reversed. In short, the very life and soul of democracy is that there are always other options.

Germany’s federal government is now abusing that basic rule in a scandalous way. There can be no doubt that the country needs to be looking at a smart mix of different energy sources for the future, and that developing viable alternatives to atomic power is an urgent necessity. Yet the manner in which the federal government has rushed to its decision to put a definitive stop to the use of nuclear energy by 2022 runs counter to all rules of democratic procedure. It began when, for politically motivated and tactical reasons alone, the government went back on the agreement made last fall — just seven months ago — to extend the life span of nuclear power plants. After the Japanese plant Fukushima began leaking radiation, it felt compelled to cede to public pressure by making a rapid move away from atomic power. Backtracking in the blink of an eye, the government moved so quickly partly out of fear of the Greens, and entirely without discussion or reflection.

… Germany has shown no respect for the energy policies of other E.U. countries, and particularly no trace of consideration for the East-West split that exists in Europe over nuclear power. Instead, Germany has chosen to go it alone on this issue, assuming a kind of avant-garde, “moral high ground” role that is not always going to play well elsewhere.

Die Bundesnetzagentur schlägt Alarm: Wegen des Atomausstiegs befürchtet die Behörde bereits in der kommenden Woche zu Pfingsten Schwierigkeiten beim Stromtransport.

PS: And lest we forget…

Germans To End Opposition To New Overhead Power Lines Overnight

June 1, 2011 By in Heconomy, Helplessness, Hi-tech, Home Cooking, Hysteria Tags: , , , , , , , , , , , , , , Leave a comment

As reported earlier, in order to avoid stunting the growth in Europe’s largest economy after its decision to shut down nuclear power forever, Germany must now carry out a massive expansion of it’s electricity-delivery network.

The overhead power lines which will be necessary to connect new offshore wind farms in the north to the factory-rich south and to allow the high-volume energy transfer from French nuclear reactors to cover the shortfall as Germany phases out its own reactors (they only provide a mere 23 percent of the country’s current energy demand) are, however, “unsightly and yucky,” as all Germans know. And they will also probably cause cancer, too (the next DANGER, but that will be another story later, guaranteed).

Fortunately for the German nation, it’s altruistic, selfless citizens have spontaneously decided to sacrifice their own petty personal concerns and grievences in regard to these power lines and win one for the collective common good by immediately ending all opposition to the construction of said yucky power lines and promising to never ever bitch or moan about them ever again, honest.

And if you believe that you can build your overhead power line on some prime Florida swamp land I’ve got for sale for you right here.

A grid upgrade is essential, and Germans must end their opposition to new power lines overhead, energy economics professor Christoph Weber said.

My Big Fat Greek Bailout II

May 31, 2011 By in Heconomy Tags: , , , , , , , , , 1 Comment

Certainly not back by populist demand, the German government now seems prepared to stop the bitching and moaning long enough to support funding for the sequel to the first Greek Bailout box office flop and enable the EU to wrap up a second package of aid loans to help a struggling Greece or, to be more exact, the German banks that are now terribly exposed to a possible default there.

“Germany is considering dropping its push for an early rescheduling of Greek bonds in order to facilitate a new package of aid loans for Greece, according to people familiar with the matter. Berlin’s concession that it must lend Greece more money, even without burden-sharing by bondholders in the short term, would help Europe overcome its impasse over Greece’s funding needs before the indebted country runs out of cash in mid-July.”

But if you want any popcorn, you’re going to have to bring it yourself.

Größter Garant der griechischen Zahlungsfähigkeit nach dem IWF mit 30 Mrd. ist Deutschland mit 22,4 Mrd.

Germans Go Home!

May 26, 2011 By in Heconomy, Helplessness, Hypocrisy Tags: , , , , , , , , , , 1 Comment

“To Save the Euro, Germany has to Quit the Euro Zone”

“When the euro was launched, leading German politicians used to argue, with evident relish (and much to the chagrin of the British in particular), that monetary union would eventually require political union. The Greek crisis was precisely the sort of event that was expected to force the pace. But, faced with a defining crisis, Ms Merkel’s government is avoiding airy talk of political union – preferring instead to force harsh economic medicine down the throats of the reluctant Greeks, Irish, Portuguese and Spanish electorates. This is becoming both economically and politically unsustainable. If the objective is to save the currency union, perhaps policy makers are looking at this from the wrong end. In the end, paradoxically, to save the European Monetary Union, the least disruptive way forward would be for the Germans, not the periphery countries, to leave.”

And in a related story…

Everything must go! The Greek government is selling everything it still has its debt-ridden little fingers on so guess who is now interested in buying Athens International Airport? Fraport AG (Frankfurt Airport).