Grossly Undervalued?

Grossly overvalued? The main thing is, gross.

Navarro

When it comes to the advantage that Germany has taken of the euro, Navarro is right about effect, if not motive.

The euro has been bad for German democracy and for German savers and may well ultimately prove to be a disaster for its taxpayers too, but it has been a boon for the country’s exporters. The euro is far weaker than the Deutsche Mark would have been (as was always likely to have been the case). This means that Germany’s decision to abandon its old currency in favor of the euro has acted as a disguised devaluation, a devaluation that has only deepened as the structural imbalances within the common currency have dragged the euro down still further.

Navarro sagte der “Financial Times”, Deutschland profitiere in seinen Handelsbeziehungen von einer “extrem unterbewerteten ‘impliziten Deutschen Mark'”.

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You Gotta Have Rules

In order for the EU to work properly, I mean. Take deficit spending (please). The infamous Maastricht “deficit criterion” from 1992 is one of my personal favorites. It’s limited to 3 (three) percent.

Rules

The euro convergence criteria (also known as the Maastricht criteria) are the criteria which European Union member states are required to meet to enter the third stage of the Economic and Monetary Union (EMU) and adopt the euro as their currency…

2. Government budget deficit: The ratio of the annual general government deficit relative to gross domestic product (GDP) at market prices, must not exceed 3% at the end of the preceding fiscal year (based on notified measured data) and neither for any of the two subsequent years (based on the European Commission’s published forecast data). Deficits being “slightly above the limit” (previously outlined by the evaluation practice to mean deficits in the range from 3.0–3.5%[9]), will as a standard rule not be accepted, unless it can be established that either: “1) The deficit ratio has declined substantially and continuously before reaching the level close to the 3% limit” or “2) The small deficit ratio excess above the 3% limit has been caused by exceptional circumstances and has a temporary nature (i.e. expenditure one-offs triggered by a significant economic downturn, or expenditure one-offs triggered by the implementation of economic reforms with a positive mid/long-term effect)”.[5][6][10] If a state is found by the Commission to have breached the deficit criteria, they will recommend the Council of the European Union to open up a deficit-breached EDP against the state in accordance with Article 126(6), which only will be abrogated again when the state simultaneously comply with both the deficit and debt criteria.

I don’t understand everything there under item 2, of course, but apparently neither did most of the countries that signed the treaty (at least I get the 3 percent part). See the graph above about the EU’s top “deficit offenders.” It’s been going on like this for years and years, too. Any questions?

In Italien droht ein Bankenkollaps, in Spanien, Portugal und Frankreich herrscht der Schuldenstaat: Die Eurozone driftet auseinander, Regeln werden kaum noch eingehalten.

Secret European Army Being Planned By The Same Folks Who Brought Us The Euro And Refugee Crises

So like what force in the universe could possibly stand in its way? Or even want to. Honey, where’s our white flag?

Army

British Brexit campaigners have been boosted with news from Berlin that Germany is once more pushing for an EU army encompassing all 28 member states with a joint HQ and shared military planning.

Along with judicial, tax and immigration issues, a Euro army has for long been one of the main irritants of anti-EU campaigners.  

“German security policy has relevance — also for beyond our country. Germany is willing to join early, decisively and substantially as a driving force in international debates … to take responsibility and assume leadership.”

Last Man Standing

Only she’s a girl.

Merkel

You have called Angela Merkel the modern-day empress of the eurozone. What do you mean?

The title empress reflects, in my view, two realities of present-day Europe. First, the Germans look so strong because the others look so weak. The British are withdrawing from Europe. The French are down but not out. They’re unable to rev up their economy – same thing for the Italians, same thing for the Spaniards. So, when you add it all up, who is the last man – or in this case, the last woman – standing?

The second reason is more concrete – the Germans have been in the vanguard of driving home fealty to the eurozone’s foundational treaties. These conventions enjoined member states, like Greece, not to overspend and over-borrow and, at the same time, to make their economies more efficient. Merkel and her finance minister are not austerity mongers as everybody is harping on about. They are committed to the original treaties’ stated rules that require eurozone members to reform their economies and become more competitive.

Zum ersten Mal seit 2005 könnte die Union einer Umfrage zufolge die absolute Mehrheit erreichen. Die Partei wäre mit 43 Prozent der Stimmen stärker als all anderen Parteien zusammen.

More German “Universalization,” Please

German policy-makers genuinely believe the harsh medicine for Greece and others is the right thing to do, he added. In some ways, Germany is “trying to universalize its own history,” Mr. Kundnani noted. That history includes an extreme leeriness of inflation and debt, plus more recent experience about a decade ago with a series of successful economic reforms, including an overhaul of its labour market.

Germany

“I don’t see Germany as being an outlier. I see it rather as someone who is in the middle ground and seeking a balance. Germany is taking a lead by managing the debate.”

Germany Defeated Yet Again

No, it wasn’t World War III. It was the Endkampf (final battle) for Bailout III. Like, don’t these people ever get tired of surrendering?

Defeat

Europe woke up on Monday to a lot of headlines about the humiliation of Greece, the triumph of an all-powerful Germany and the subversion of democracy in Europe.

What nonsense. If anybody has capitulated, it is Germany. The German government has just agreed, in principle, to another multibillion-euro bailout of Greece — the third so far. In return, it has received promises of economic reform from a Greek government that makes it clear that it profoundly disagrees with everything that it has just agreed to.

“History repeats itself, first as tragedy, second as farce.”

Little Oskar Thinking Out Of The Box Again

Well known for his refreshing viewpoints, Mr. ex-SPD, ex-Left, ex-Bolshevist, ex-you-name-it Oskar Lafontaine himself has come up with a brilliant new idea to save Greece from its upcoming euro Grexit exit: Get rid of the euro first.

Oskar

Being the true radical thinker that he is, he seems to have devised a radical new European economic system by which goods or services are directly exchanged for other goods or services without having to use a medium of exchange like dirty, filthy, old (or in his case new) money. And the way things look right now, Greece will be the first country to get the chance to test this out in a big way.

“Der Euro ist ein Rückschritt im historischen Projekt der europäischen Integration. Der Euro ist schon gescheitert, wir dürfen uns da keinen Illusionen hingeben.”

Greeks Apologize And To Pay Back All Debts Tomorrow

The nation of Greece said sorry to the European Union with a present of an enormous wooden horse.

Horse

Left outside the European Central Bank in the dead of night, the horse has now been moved into the ECB’s central lobby where it is proudly on display.

A gift tag attached to the horse, which is surprisingly light for its size and has small holes along the length of its body, suggested that it should be placed in the bank’s vaults overnight to avoid it being targeted by thieves…

Oddly, Greek representatives in Brussels have hinted that they may soon be in a position to settle their debts and have puzzled the French and German banks that hold their loans by asking if there is any discount for cash.

PS: Thanks for the link, A.K.

Germans So Shocked By Greek No They Decide To Go On Big Fat Greek Vacation

Stunned by the Greek no yesterday and the end of European civilization as they know it, millions and millions of German tourists have spontaneously decided to get their minds off it all by going on vacation to Greece again this year, just like the millions and millions of other Germans who did the same thing last year.

Tourists

Not that it matters anymore or anything, but tourism used to account for 18 percent of what used to be the Greek economy.

“We are still taking bookings for Greece and there is no change in the levels.”

German Of The Day: Schwitzkasten

That’s “sweat box” but actually means stranglehold. You know, like being stuck between a rock and a hard place?

Tsipras

Is the current five-year Greek drama finally going to come to an end today? Hardly, it already ended quite a while ago, the real drama having actually begun long before that, of course, generations before. The name of the drama is “Living Beyond Our Means” and now the current government wants to give Greek voters the illusion that it gets the chance to turn back the clock with one final vote, a final vote that doesn’t actually mean anything, of course, because the money is long gone and nobody is going to give you any-more-anymore. Said current government has seen to that.

It took many, many years of concerted effort – on the Greek side – to get this far, but at least now we will all have an “official” result: However Greece votes today it has already voted to escape “financial asphyxiation” by committing financial suicide.

After all, debt and guilt – “Schuld” – are the same words in German.