German Of The Day: Handelskrieg

That means trade war.

Handelskrieg

A trade war between the United States and Europe is coming and the fallout could tip Germany into recession, according to analysts at German lender Commerzbank…

Official German statistics supplemented by the bank’s own research show that in 2018, the United States was the top export destination for German cars, accounting for about 12% of the total with a value of 27 billion euros of parts or finished vehicles.

The bank estimated that a Trump-ordered tariff increase of 25 percentage points on EU auto imports would slash that figure for Germany down to around 14 billion euros per annum.

When factoring in how much of that export figure is actual German “added value,” the bank estimated that total economic output for the country could fall by around 0.25 percentage points.

“All the more dangerous in a situation where the German economy is only just managing to avoid a recession,” it read.

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German Of The Day: Abkühlung

That means cooling or cooling off.

Cooling

You know, like German growth predicted to stall during 2019 in significant Abkühlung?

Germany’s economy could experience a “significant cooling” in 2019 and could see sharply lower growth this year, the country’s leading economic institutes have warned in a report compiled for Germany’s economics ministry.

Forecasts for German growth were revised significantly downwards in a ‘Joint Economic Forecast’ collated by several prominent German economic research institutes and published Thursday, with economists predicting a meager 0.8% this year.

This is more than one percentage point lower than a prediction for 1.9% made in a joint economic forecast in fall 2018.

“The long-term upswing of the German economy has come to an end.”

German Of The Day: Die fetten Jahre sind vorbei

That means the “fat” (good) years are over.

Fat

Merkel Doesn’t Want to Tell Germans the Good Times May Be Over – The leaders preparing to take over when Merkel steps aside are worried too. They say voters could be caught unawares by an economic shock in the middle of the political transition from Merkel’s rule. Two senior party officials this month voiced concerns that such a double whammy could shake up the political map ahead of the next election. They asked not to be identified questioning the chancellor’s approach.

One shouldn’t undermine the economic upswing by talking it down.

No Job Losses Here

In Germany. Then everybody’s happy, right?

A380

The German government is not expecting widespread job cuts in Europe’s largest economy following Airbus’s decision to scrap production of the A380 superjumbo, the aerospace policy coordinator told Reuters on Thursday.

“We expect these jobs will largely continue to exist, working on different models such as the A350, the newest plane on the market, or the A330 neo.”

 

The Worst Is Over

Or something.

Growth

For much of the financial crisis that started in 2007, Germany remained strong and held the envy of modern economies around the world.

In 2010, the industrious country known for its fiscal discipline had GDP growth of 4.2%, followed by respectable 3% GDP growth in 2011.

Unfortunately, for Germans and the world, there are increasing signs the German economy is being marred by the global crisis. In 2012, GDP growth was a meager 0.7%. More significantly, GDP actually contracted by 0.5% in the fourth quarter.

Währung – Deutschland: Devisen: Euro gibt nach – IWF prognostiziert auch für 2013 Rezession im Euroraum

Dangerous ideas

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.

Things are as they are...

„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.”