Why Germany’s current-account surplus is bad for the world economy

[Deleted]

This thread is quite amusing. Basically bad Germans need too perform worse in order to make others feel more comfortable.

Just to add something to the amusement on my own I'll post these images. They are rough equivalents of 50 euros in pre-euro currencies. I wonder if you can see the pattern.

[Deleted]

Probably we should lower our production standards to allow other countries to catch up.

Or we just invest the money into american tanks and carriers. AFAIR, Donald Trump wants us to buy way more arms because he wants us to get to 2% of the GDP for military investments.

While i dont know where we should put all those additional guns, tanks and carriers. And what Vladimir Putin would think.

[Deleted]

As far as I can tell, Germany didn't have huge loans kickstarting education as well. But since I'm not 100% aware of the financial situation right after the war, I'll give the the benefit of a doubt.

The point is that they did have very qualified (for that time) education, sure it did get derailed becuse of war or aftermath of the war, but the knowledge and system was still there. I will go to the University after the war or after the repaired the worst bomb damage.

[Deleted]

It's a distortion generated by the Euro, Germany's ageing population being frugal and artificial suppression of wages.

Last i checked real incomes increased in germany.

The issue would probably balance itself if the Euro was gone, but alas its The Economist and ideas like that are pretty rare there.

No it wouldn't - Italy, Greece, and Spain had shit economies before the Euro too.

[Glorious Leader]

I've been able to figure just fine, that after all those money packages sent their way, nothing has improved. Maybe their corrupt politicians should think of fixing things with said money, to then be able to pay back loans. But no, they want to extend the unsustainable lifestyle they've grown accustomed to instead. Every chance they get.

And you think they won't continue down the very same line if you magically wipe all their debt away? I guess it's the evil EU who made them that corrupt or something? Nevermind that they in all their noncorrupt honesty totally didn't doctor the books to be able to join EU in the first place.

Or how about they just get on with paying the debts, without the neverending excuses.

Debts that cant be paid wont be paid.

Frankly most of the debt greece caries falls under odious debt as it did nothing to help the greek state and was simple give aways to bankers. More over its typicaly th responsibility of the lender to do proper due dilligence when lending to see how the lendee will pay back. In fact imf rules state this expressly but strauss kahn created an exception in cases of systemic threats. Of course why greece should be forced to sell of its assets in a fire sale and capitulate to what is essentially financial warfare is never asked. Get on with paying them back indeed...

[Azadina]

Debts that cant be paid wont be paid.

Frankly most of the debt greece caries falls under odious debt as it did nothing to help the greek state and was simple give aways to bankers. More over its typicaly th responsibility of the lender to do proper due dilligence when lending to see how the lendee will pay back. In fact imf rules state this expressly but strauss kahn created an exception in cases of systemic threats. Of course why greece should be forced to sell of its assets in a fire sale and capitulate to what is essentially financial warfare is never asked. Get on with paying them back indeed...

If I faked documents to get a large bank loan, spent the money, and then told them "oh yea, you remember all those credentials I showed to get the loan approved? All doctored, no money to pay back"

I'd go to jail instead of being showered more money to fix the debt I already made, but when Greece doctors their books to get approved in EU, all is good right? Everyone is just too hard on them, poor them for committing fraud.

[Glorious Leader]

If I faked documents to get a large bank loan, spent the money, and then told them "oh yea, you remember all those credentials I showed to get the loan approved? All doctored, no money to pay back"

I'd go to jail instead of being showered more money to fix the debt I already made, but when Greece doctors their books to get approved in EU, all is good right? Everyone is just too hard on them, poor them for committing fraud.

Fun fact: Goldman sachs helped them cook the books. Of course the I in your case is a bit different given greece isnt actually an individual. This actually makes it the definition of an odious debt.

In any event yes it is the responsibility of the lender to do proper due diligence on how exactly the lendee will pay back the money.

[Yvaelle]

I think at this point anyone who makes a deal with Goldman Sachs deserves inexxorably getting screwed. GS is a terrorist organization in the banking world: sometimes they do malicious things that don't even make them a profit, it's just evil for evil's sake.

[Sunseeker]

Actually Greece would never have managed to become that big of a mess without the Euro simply because it would never have been capable of raising that level of debt with the drachma.

Well how big of a mess is debatable, but they were still some level of mess.

[Deleted]

Probably we should lower our production standards to allow other countries to catch up.

Or we just invest the money into american tanks and carriers. AFAIR, Donald Trump wants us to buy way more arms because he wants us to get to 2% of the GDP for military investments.

While i dont know where we should put all those additional guns, tanks and carriers. And what Vladimir Putin would think.

Well, of course its easier to focus on economy when someone else stems the military for your country.
Consider this side as well.

- - - Updated - - -

I think at this point anyone who makes a deal with Goldman Sachs deserves inexxorably getting screwed. GS is a terrorist organization in the banking world: sometimes they do malicious things that don't even make them a profit, it's just evil for evil's sake.

Also Soros. These people deserve to be stripped of their legacies and foundations.

[Realitytrembles]

Excess saving is bad? Even the phrase "excess saving" is ludicrous. Germany should do what is good for Germany. As the USA should do what is good for them.

Trump talks sht about half the time, but when he articulates economically nationalist positions, he has my full support. In my view, he who supports free trade is a traitor to his own country and especially its working class.

[Omega10]

Nice we are back to Germany being the root of all evil...

Please educate yourself:



Guess what, the Germans didn't want the EURO and where forced into it in the unification process. Turns out it backfired to other countries and now you blame us?!

May I suggest you do your homework and get your shit together instead of always pointing fingers at us?

Start with not selling out your own industry and high tech and pay taxes for starters?

No. It is not "Germany is the root of all evil.", it is more like "Germany is becoming a superpower, and what they do affects lots of other countries." Germany is fighting with India and China to gain some of the power that the US is shedding. And one of the prices of this power is others start demanding things back of the country in power. The good news for America is that as we decline, other nations will expect considerably less of us, and mostly will no longer care what decisions we do or do not make. Other nations will care more about what Germany, China, and India do instead.

[Xarkan]

Or we just invest the money into american tanks and carriers. AFAIR, Donald Trump wants us to buy way more arms because he wants us to get to 2% of the GDP for military investments.

You could buy German tanks. Why downgrade?

Edit:

While Trump may stupidly want countries to spend it now the 2% is a NATO goal. The difference is that growing to 2% of gdp does not require buying tanks to stand pretty in parking lots.

[Deleted]

Well, of course its easier to focus on economy when someone else stems the military for your country.
Consider this side as well.

Germany is one of the top 10 military spenders worldwide.
https://en.wikipedia.org/wiki/List_o...y_expenditures

[PL-Cibo]

Well, of course its easier to focus on economy when someone else stems the military for your country.
Consider this side as well.

Nobody stems the military for germany or the EU. We have our own. We just don't want to pump as much money in it. Because, well we are not at war. We haven't had a war since 1945. there is no war on the horizon yet.

[Altariaz]

The article is sort of indirectly suggesting Germany ought to perform worse as an economy to make other nations more successful,

Eh? No it does not. What on earth are you on about? The article suggests that if Germany used more of it's savings to buy and invest, in particular on imports, then that will increase foreign income and demand in that foreign nation, which will on average benefit Germany. This is not 'neo-liberal' economics, or some childish 'hate-tag' you want to put on things, but common damn sense. Get with the plot, or don't post.

[Sunseeker]

Eh? No it does not. What on earth are you on about? The article suggests that if Germany used more of it's savings to buy and invest, in particular on imports, then that will increase foreign income and demand in that foreign nation, which will on average benefit Germany. This is not 'neo-liberal' economics, or some childish 'hate-tag' you want to put on things, but common damn sense. Get with the plot, or don't post.

I'm pretty sure there was a whole rest of my post there, but since apparently you can't read beyond a sound byte, I'm not inclined to give two shits what you think.

[Holofernes]

Eh? No it does not. What on earth are you on about? The article suggests that if Germany used more of it's savings to buy and invest, in particular on imports, then that will increase foreign income and demand in that foreign nation, which will on average benefit Germany. This is not 'neo-liberal' economics, or some childish 'hate-tag' you want to put on things, but common damn sense. Get with the plot, or don't post.

what should we import if we already have everything? Should we put our bmws audis and porsches on the scrapyards and buy dodge rams that need triple the gasoline? Germany spends so much more on electricity (30 cts / kwh is average price) and gasoline (1.30 euro for one liter / 1.50 dollar for a liter / ca 7 dollar for a gallon). most of our import is actually energy.

The concept that exporting more than you import is good for the economy is very old. Its the same for bank account: either u have buying power by having something in it , or you are a debt joe dependant on the guys you owe. America is owing so much to other nations, and this way of living depends on the mercy of the debitors. Germany like their independence, they dont want to be at mercy of somebody else. America used to like their independance too, but nowadays its only a firework.

Households with several 1000 dollar of credit card dept from daily life is something that is unheard of in germany. Even the poor people have no severe debts, like common in US, and most people rather save 10 years and start building a house with their own hands than buying one on debit.

[Deleted]

Well, of course its easier to focus on economy when someone else stems the military for your country.

Our military is being paid by our people. We just dont pay 2% of our GDP, but just 1,2%. Which is still more in total than other european nations except france and UK.

The number of tanks and soldiers doesnt really matter in the days of nuclear weapons. Nowadays, you gain power by econonmics.

[Wildtree]

Well, of course its easier to focus on economy when someone else stems the military for your country.
Consider this side as well.

hey, no problem..
Germany stems it's own military expenses.. Raises that approx. 1% it's short spending..
We'll charge the US rent for the occupation of all the land and military bases it maintains in Germany, against most people's will.
I mean it's nice and everything to blabber that nonsense you hear from that orange monkey in the white house. Fact however is, that the US fared extremely well so far with it's presence especially in Germany. Since the country just happens to be the geographic center of Europe, and being able to station your troops there helps your global military strategic operations more than it protects the Germans.
If your dumbass president keeps whining and Europe's countries get serious, the US would have quite a big strategic problem at its hands. Losing all those bases would hurt.
So, let's stay serious here.. The situation at hand is one that exists ever since 1945, and no one ever bitched, since it's a situation that helps both sides.
Yet, if you're unhappy, feel free to leave.