New inflation worries in Germany

Like where to find it. There are worse things to worry about, I guess.

If you have to look at the bright side in Germany these days, and some folks just can’t help it, then maybe having a look at the German inflation rate might help you out. It’s the lowest it’s been in twenty years, at zero. Zero is pretty low, if you stop and think about it, so that’s a good thing, I think.

That’s right. Prices haven’t risen here in a year, on average, so-to-speak. Of course wages haven’t necessarily risen all that much either (for those still working), but still.

„Die Null-Inflation sorgt dafür, dass die Menschen trotz wachsender Ängste um ihren Arbeitsplatz oder die Sorge um die Staatsfinanzen ihre Kauflust bisher nicht verloren haben. Und der stabile Inlandskonsum ist derzeit die einzig verbliebene Konjunkturstütze.“

Put the wheels back on again already

“It was never meant to be like this. A reunified Germany, at the heart of an expanding European Union and single currency, was supposed to offer a decent, stronger alternative to the “casino capitalism” that Germans have long thought of as represented by the US model that they love to hate.

When the credit crunch first broke in the autumn of 2007, bringing banks such as Northern Rock down almost immediately, the Germans allowed themselves a quiet chuckle of schadenfreude along the lines of “we told you so”.

But that was before the financial crisis swept through Germany’s banking system, which turned out to have had its tentacles deep into the sub-prime mortgage market in the United States. And it was before the collapse in world trade that Germany had previously depended on to drive its economy.”

“The Opel crisis is part of a much wider problem.”

Dangerous ideas

May 26, 2009 By Hermann Observer in Heconomy Tags: Recession Leave a comment

Questioning Germany’s economic model, I mean. Everything is sacrosanct here, nobody rocks the boat and nothing ever changes for the Germans. Not even (or especially so?) when everything else around them appears to be changing faster and faster all the time.

„The questions go to Germany’s future. Simplified, they ask: Can its economic model, the so-called social market economy, survive a crisis in which some of its assumptions and conceits have been devastated? Or: What does the country do about re-establishing or refashioning its dependence on exports, which are imploding as the Great Recession drags on?

The issues are essentially political because both mainstream parties spoke for months with a single voice in offering Germans and the world a fib (kind hearts might call it a misleading misjudgment): the idea that the German economy and its banking system were robust, oblivious to the implosion of American-led speculative schemes and a model of regulated, state-supervised capitalism that Chancellor Angela Merkel said the planet should follow…

The social market economy was an empty shell, Wolfgang Münchau wrote in The Financial Times Deutschland, referring to it as a “discontinued, one-off model. Its network of social protections is sanctified. But trade-offs among its interest groups, he said, have taken over the system’s fulcrum of power.“

“I think we’re in a kind of tape delay, cushioned by our welfare state.”

Sex and taxes

May 25, 2009 By Hermann Observer in Heconomy Tags: Prostitution Leave a comment

Or was it death and taxes? Anyways, if you absolutely positively must auction yourself off online somewhere, don’t do so at a German site.

This of course being tantamount to prostitution, and with Germans taxing their prostitutes at 50% of their earnings, you could, well, really get screwed or something.

„Die Brünette hatte sich eine höhere finanzielle Entschädigung erhofft.“

Uh oh, this really is a crisis

May 19, 2009 By Hermann Observer in Heconomy Tags: Flying 2 Comments

When Germans stop flying off on vacation, it’s all over. The number of German passengers fleeing the country (mostly for vacation) sank a record 9.3 percent during the first quarter of this year.

Records show that the biggest drop in bookings was seen with those flights to the United States, this down nearly 18 percent, meaning some 1.9 million less German visitors than in the first three months of 2008. And this is Obama-America now too, you know. Oh my God we’re all gonna die or something.

„Die Zahl der von deutschen Flughäfen aus startenden Passagiere sank im ersten Quartal um 9,3 Prozent und damit so stark wie seit 15 Jahren nicht mehr.“

All German Opel plants, all the time

May 5, 2009 By Hermann Observer in Heconomy Tags: Fiat Leave a comment

Soon Chancellor-not-to-be and current Vice-Chancellor and part-time Foreign Minister Frank-Walter Steinmeier (so like how many hyphens was that?) is mad as hell and isn’t going to take it anymore. Not during election time at least.

He has cast doubt on Fiat’s proposed plan to take over Opel if consolidation includes closing any of Opel’s four production plants. Italians can’t vote here, you see. And they wouldn’t vote for him if they could, so there.

By the way, you mayboe ought to know what some Germans say Fiat stands for: Fauler Italianer aus Turin (lazy Italian from Turin).

„Für Wahlkampfzwecke missbraucht?“

Where are all the nervous Germans when you need them?

April 30, 2009 By Hermann Observer in Heconomy Tags: GDP 2 Comments

What’s a 6 percent contraction in the economy, anyway? We’ve seen worse.

Well no, actually we haven’t. But we’re not worried. Not us. Not yet anyway. We’re calm, perhaps too calm, but calm all the same.

“One reason that we are only seeing small protests is that politicians will not reveal the true cost of the crisis until after the parliamentary elections… Perhaps there will be a new wave of cost-cutting welfare reforms, like those which spawned the unpopular Hartz IV scheme.”

“Three months ago, the German government was forecasting that G.D.P. would contract by 2.25 percent in 2009. But since then, Berlin has suffered from plummeting demand for its products as its foreign customers rein in spending.”

PS: Why do I get the feeling that everybody in Berlin is about to RUN INTO A WALL again?

How bad is the sex recession in Germany these days?

March 22, 2009 By Hermann Observer in Heconomy Tags: Prostitution 3 Comments

Why it’s so bad…

That when sex workers start suggesting stimulus packages they’re actually referring to money. Bad? It’s so bad in German brothels these days that fewer and fewer people are coming. We’re talking bad. It’s so bad that experts fear the industry is flat on its back. You want bad? It’s so bad these days that it might take months or even years before business picks up and turns the street corner again.

“Economic aid would be judicious.”

Germans begin offshore offensive

March 19, 2009 By Hermann Observer in Heconomy Tags: Banking secrecy Leave a comment

Pulling out their favorite charm cannon Finance Minister Peer Steinbrück himself, the Germans have begun battering neighboring offshore financial center states like Switzerland after launching a surprise ravaging verbal abuse offensive.

Hoping to recover unpaid taxes in vicious hand-to-hand or at least toungue-to-tongue combat (yuk), Steinbrück has lambasted the small, defenseless, filthy rich neutral country for being a safe haven for thousands of rebel German fiscal terrorists who have stashed away their savings there for some mysterious reason that nobody here in Berlin can even begin to explain, much less figure out.

Steinbrück has even openly “doubted” Swiss promises to make their banking system more transparent, initiating a further diplomatic scandal between the two nations. Other than the surprise ravaging verbal abuse offensive part, I mean. The Swiss Foreign Ministry has actually summoned the German ambassador to protest the “unacceptable” remarks by Steinbrück. But this was long after the offensive started so like who cares?

That offshore financial centers like Switzerland have nothing to do with the problems created by cash-strapped governments like Germany impresses Herr Steinbrück little as they are nevertheless easy targets to bash at the moment and this gracefully distracts from the current political paralysis in Berlin concerning all things having to do with the financial crisis, or at least with all things having to do with the financial crisis and international solidarity.

„Er erklärt, wieso die Eidgenossen Bundesfinanzminister Peer Steinbrück (SPD) für einen hässlichen Deutschen halten.“

Obama und co. werden es richten!

March 17, 2009 By Hermann Observer in Heconomy Tags: Opel Leave a comment

Oder (won’t they? fix this mess?)? After doing something the Germans call Shakehands with top GM executives in US-Amerika, and then getting a green light from them (GM is interested in keeping a minority stake in Opel), German Economy Minister (Mininster for the Economy?) Karl-Theodor zu Guttenberg now sees hope for the ailing German-American, American-German car maker after all.

Although the German government was completely unconvinced by the rescue plan Opel submitted to them earlier this month, rightly arguing that it left too many questions unanswered, Guttenberg figures he can now convince our smart guys in Washington with the same plan, easy. And he’s probably right, too. These guys will buy anything.

The Germans are reluctant to throw tons of money at Opel unless it stands a good chance of surviving the current crisis, you see, AND unless they can avoid seeing any German state aid being funneled across the Atlantic to prop up that evil Mother of All Car Companies, GM. They aren’t doof (stupid). They want it the other way around. GM gets the money from the US government and then indirectly subsidizes Opel by taking a minority stake as private investor.

Like I said, Herr zu Guttenberg is optimistic and I don’t blame him one bit for being so. This plan sounds bullet-proof to me. This is true German economics in action. He’s the Economy Minister, remember? Minister for the Economy, I mean.

„Aufschluss über die Haltung der US-Regierung erwartete sich der Bundeswirtschaftsminister aus den geplanten Gesprächen mit dem US-amerikanischen Finanzminister Timothy Geithner. Doch der hat in der Krise mit den Schwierigkeiten der US-Finanzfirmen wie dem Versicherer AIG noch ganz andere Probleme als Opel und General Motors auf dem Tisch.“

Observing Hermann

“Was interessiert mich mein Geschwätz von gestern?”

Category Archives: Heconomy