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> Germany has recorded its first monthly trade deficit [€1bn] since 1991 [the year of reunification] amid soaring inflation and supply chain disruption weighing

> Germany has recorded its first monthly trade deficit [€1bn] since 1991 [the year of reunification] amid soaring inflation and supply chain disruption weighing on the country’s industrial base. Then from Wikipedia: > In 2016, Germany recorded the highest trade surplus in the world, worth $310 billion. ... https://en.wikipedia.org/wiki/Economy_of_Germany https://en.wikipedia.org/wiki/Economy_of_Germany So it's not just the magnitude of the trade balance (negative) but the velocity (sharply downward) that should get attention. The US has run persistent trade deficits (now ~ $50 billion) for years. This brought cheap goods but eviscerated the manufacturing base. You could call it a tradeoff. What the US has going for it though is: (a) the ability to print its own money; (b) the ability to print the world's reserve currency; and (c) the demographics to support a consumption-led economy. Germany has none of these things going for it. The situation is not sustainable. The article implies that the change is not structural (increased competition from elsewhere, for example), but if it is things could get weird real fast.

_trampeltier 4y ago
Bloomberg has a nice graph. https://www.bloomberg.com/news/articles/2022-07-04/germany-has-first-monthly-trade-deficit-since-1991-on-exports https://www.bloomberg.com/news/articles/2022-07-04/germany-h...
- gpderetta 4y ago
  Warning: extremely nasty back button hijack.
  - dunefox 4y ago
    I will never understand why this is done.
- enlyth 4y ago
  https://archive.ph/OftCI https://archive.ph/OftCI
frankfrankfrank 4y ago
There are other issues with this number that also comes with a surge in imports, just to mention one of the other hidden factors that are making everything extremely unstable.
njarboe 4y ago
Missed a zero. The US trade deficit is has ranged from about $400 to $800 billion per year for the last two decades[1]. [1]https://www.macrotrends.net/countries/USA/united-states/trade-balance-deficit https://www.macrotrends.net/countries/USA/united-states/trad...
imtringued 4y ago
>Germany has none of these things going for it. The situation is not sustainable. What? Balanced trade is inherently sustainable. If Germany exported for the last few decades then it is going to import for a few decades at some point. That is how balanced trade works.
- bestnameever 4y ago
  >. If Germany exported for the last few decades then it is going to import for a few decades at some point. why does there have to be balanced trade? I don't believe balanced trade just happens naturally in a free market.
- 411111111111111 4y ago
  > If Germany exported for the last few decades then it is going to import for a few decades at some point not necessarily. A situation like this could easily and quickly spiral out of control. High inflation could wipe out decades of trade surpluses and germany cant even control their own inflation, because its using €, which is controlled by the European Central Bank. As a german citizen I'm hopeful that its only temporary however and that our economy recovers at least somewhat over the next few years.
- kurupt213 4y ago
  Why do you assume trade is balanced
raxxorraxor 4y ago
Many businesses currently have severe supply issues. Prizes for computer chips are 100 times higher in some cases. The situation is a bit better now but many could not produce as much as they wanted in the past quarters. Now many businesses run extra work shifts because there are massive back orders. My company could send sales into holiday until mid 2023, they currently basically sell stuff that doesn't exist... But computer chips are just a small part, inflation is mainly driven by energy prices right now. Germany's economy is also heavily globalized and any conflicts or reduced global trade will hit the economy pretty hard. Still, exports totally were just reduced by ~ .5% while imports increased by 2.7%. But these small percentages already create an imbalance.

_trampeltier 4y ago

Bloomberg has a nice graph. https://www.bloomberg.com/news/articles/2022-07-04/germany-has-first-monthly-trade-deficit-since-1991-on-exports https://www.bloomberg.com/news/articles/2022-07-04/germany-h...

gpderetta 4y ago
Warning: extremely nasty back button hijack.
- dunefox 4y ago
  I will never understand why this is done.
enlyth 4y ago
https://archive.ph/OftCI https://archive.ph/OftCI

frankfrankfrank 4y ago

There are other issues with this number that also comes with a surge in imports, just to mention one of the other hidden factors that are making everything extremely unstable.

njarboe 4y ago

Missed a zero. The US trade deficit is has ranged from about $400 to $800 billion per year for the last two decades[1]. [1]https://www.macrotrends.net/countries/USA/united-states/trade-balance-deficit https://www.macrotrends.net/countries/USA/united-states/trad...

imtringued 4y ago

>Germany has none of these things going for it. The situation is not sustainable. What? Balanced trade is inherently sustainable. If Germany exported for the last few decades then it is going to import for a few decades at some point. That is how balanced trade works.

bestnameever 4y ago
>. If Germany exported for the last few decades then it is going to import for a few decades at some point. why does there have to be balanced trade? I don't believe balanced trade just happens naturally in a free market.
411111111111111 4y ago
> If Germany exported for the last few decades then it is going to import for a few decades at some point not necessarily. A situation like this could easily and quickly spiral out of control. High inflation could wipe out decades of trade surpluses and germany cant even control their own inflation, because its using €, which is controlled by the European Central Bank. As a german citizen I'm hopeful that its only temporary however and that our economy recovers at least somewhat over the next few years.
kurupt213 4y ago
Why do you assume trade is balanced

raxxorraxor 4y ago

Many businesses currently have severe supply issues. Prizes for computer chips are 100 times higher in some cases. The situation is a bit better now but many could not produce as much as they wanted in the past quarters. Now many businesses run extra work shifts because there are massive back orders. My company could send sales into holiday until mid 2023, they currently basically sell stuff that doesn't exist... But computer chips are just a small part, inflation is mainly driven by energy prices right now. Germany's economy is also heavily globalized and any conflicts or reduced global trade will hit the economy pretty hard. Still, exports totally were just reduced by ~ .5% while imports increased by 2.7%. But these small percentages already create an imbalance.