6 ms·

Where is the evidence for this claim? "It got out of that slump thanks to the euro, which created a boom in southern Europe, and thus generated export markets

by sien 11y ago

Where is the evidence for this claim? "It got out of that slump thanks to the euro, which created a boom in southern Europe, and thus generated export markets for Germany. " Germany's biggest trade partners are France, US, UK and China. https://www.destatis.de/EN/FactsFigures/NationalEconomyEnvironment/ForeignTrade/TradingPartners/Tables/OrderRankGermanyTradingPartners.pdf?__blob=publicationFile https://www.destatis.de/EN/FactsFigures/NationalEconomyEnvir... Germany's improvements have more to do with Germany's changes to industrial --(relations) reform than to do with Southern Europe: https://en.wikipedia.org/wiki/Hartz_concept https://en.wikipedia.org/wiki/Hartz_concept -- edit added (relatations) to the sentence.

zurn 11y ago
The mechanism by which Germany has benefited at the expense of other Euro countries is the large trade surplus vs exchange rates. Normally a big country's currency will appreciate once they start running prolonged large trade surpluses, but the Euro has enabled Germany to keep siphoning in wealth in a way that wasn't possible before the Euro. Similarly pre-Euro the southern countries would have seen their currencies depreciate and get a break in competitiveness. Hartz is also part of it, Germany has kept labour costs down while southern countries in the same currency area experienced high inflation due to masses of cheap money coming in again due to the Euro. And of course Germany has been leading the austerity brigade in response to the crisis. http://www.brookings.edu/blogs/ben-bernanke/posts/2015/04/03-germany-trade-surplus-problem http://www.brookings.edu/blogs/ben-bernanke/posts/2015/04/03...
- istvan__ 11y ago
  I am not sure if Germany at fault here, bringing in the euro was not forced by them and Greece was cooking the books to get in. http://www.forbes.com/sites/timworstall/2011/09/12/greece-was-lying-about-its-budget-numbers/ http://www.forbes.com/sites/timworstall/2011/09/12/greece-wa... I think most of southern Europe should be not in the euro zone at all, their economy would have better time on a weaker currency. http://stephansmithfx.com/articles/how-a-weak-currency-affects-an-economy/ http://stephansmithfx.com/articles/how-a-weak-currency-affec...
  - r00fus 11y ago
    > I am not sure if Germany at fault here, bringing in the euro was not forced by them and Greece was cooking the books to get in. s/Greece/people running Greece at that time/ If you asked the who didn't profit from joining the Euro, likely you might have gotten a negative reply. Seriously it's not a fault issue here because multiple parties (including the vampire squids that are multination financial corporations like Goldman) conspired to profit from it. Question is what is going to be done to right the ship and avoid calamity?
    - atmosx 11y ago
      Given the situation, I don't think that Greece has anything to gain from staying in the common currency. After ~ 8 years of Troika mismanagement the country is in dire situation and there has not been the slightest perception of improvement. So even if SYRIZA choose to blink, the next government wont.
  - zurn 11y ago
    Singling out Greece's creative accounting in Euro accession as the main problem is blaming the victim here. A lot of the countries did it to some extent, the EU turned a blind eye. And most of Greece's budget deficit happened only after joining the Euro. Greece is despite their own share of f-ups largely a casualty of the systemic problems and EU's failure in handling of the crisis.
    - Bootvis 11y ago
      Come on, they cooked their own books and noone forced them. They may suffer from that now but pointing that out is not 'victim blaming'.
      - gizmo 11y ago
        Spain is also suffering and they didn't cook their books. It was also an open secret that Greece's numbers were manipulated, but the ideal of a united Europe with one currency overruled economic pragmatism. Even if Greece had no corruption at all they would still be in a nearly indistinguishable position. They still would have been flooded with debt (simply a consequence of interest rates dropping during the boom) and they would still get a crushing depression (because that's what happens when you share a currency with larger and economically stronger countries). When Greece joined the Euro the outcome was nearly inevitable, so blaming Greece for this makes little sense. The austerity policies the troika imposed on the Greek people were brutal and completely unnecessary, though. So that's the outrageous part.
- fulafel 11y ago
  Another good article about the German situation is this post from Simon Wren-Lewis: http://mainlymacro.blogspot.com/2013/11/the-real-problem-with-german.html http://mainlymacro.blogspot.com/2013/11/the-real-problem-wit...
atmosx 11y ago
Germany enjoys the lowest unemployment rate in history, while Greece has a humanitarian crisis and Spain has also extremely high unemployment. That's not a coincidence. > Germany's improvements have more to do with Germany's changes to industrial reform than to do with Southern Europe [...] Then let Greece default (as a Greek I believe that's best for my country in the long term) and see how that plays out. BTW the lack of understanding of 101 macro-economics by Scheuble is disheartening[1]. Every time he speaks, he is comparing economy-wise countries to businesses and/or households, which coming from a FinMin is plain ridiculous[2]. [1] http://www.brookings.edu/blogs/ben-bernanke/posts/2015/04/03-germany-trade-surplus-problem http://www.brookings.edu/blogs/ben-bernanke/posts/2015/04/03... [2] COMPETITIVENESS - A DANGEROUS OBSESSION P. Krugman, 1994, Foreign Affairs Magazine http://www.pkarchive.org/global/pop.html http://www.pkarchive.org/global/pop.html
- mkesper 11y ago
  Let Greece default ... and see how that plays out. I'm horrified of the carelessness with which that option seems to be considered by the Greek government.
  - Someone 11y ago
    I'm not saying it is the best option, but IIRC, the current alternative is to have the country on life support until at least 2050. The Greek government doesn't need to be carelse's to consider a default the better option.
  - mcv 11y ago
    It's not a great option, but considering the circumstances, the Greek government doesn't really have a lot of options. Ideally, the debt would be reduced in a controlled manner to a point where Greece can afford to pay off the remainder, but Germany seems to be set on steering towards a Greek default.
  - michael2l 11y ago
    A default is a horrible outcome, but "that which can't be paid back won't". It's been pretty clear for a while now that the debt load for the Greek economy is too great and some sort of bankruptcy(default) is required. The ECB and others have conspired to hide this with the collusion of previous Greek leaders, by heaping on more onerous debt and calling it a bailout. It will have to end at some point. What's occurred up until now is fraud with the intent that someone further down the road will have to deal with ensuing mess. But it's likely the game of kick the can will continue.
nisa 11y ago
The Hartz reforms did lower labour costs for some companies and created a huge new segment of low-income workers that have almost no chances to earn a a regular job and besides that temp work was legalized and is largely employed to lower wage costs. This made the exports possible and made a few people rich. A lot of people argue it's unhealthy and will bite Germany in the long term. Besides that: The average german is still far better off than the average greek.
pvaldes 11y ago
This is not really an evidence but maybe you could count as an symptom or even do the test by yourself. TV ads from german companies seem to be everywhere now in southern Europe. You can count three in a row easily and before the scam this was not usual at all. When a company needs to spend more resources in advertising, you can safely infer that they are having some troubles to sell their products.

by sien 11y ago

zurn 11y ago

The mechanism by which Germany has benefited at the expense of other Euro countries is the large trade surplus vs exchange rates. Normally a big country's currency will appreciate once they start running prolonged large trade surpluses, but the Euro has enabled Germany to keep siphoning in wealth in a way that wasn't possible before the Euro. Similarly pre-Euro the southern countries would have seen their currencies depreciate and get a break in competitiveness. Hartz is also part of it, Germany has kept labour costs down while southern countries in the same currency area experienced high inflation due to masses of cheap money coming in again due to the Euro. And of course Germany has been leading the austerity brigade in response to the crisis. http://www.brookings.edu/blogs/ben-bernanke/posts/2015/04/03-germany-trade-surplus-problem http://www.brookings.edu/blogs/ben-bernanke/posts/2015/04/03...

istvan__ 11y ago
I am not sure if Germany at fault here, bringing in the euro was not forced by them and Greece was cooking the books to get in. http://www.forbes.com/sites/timworstall/2011/09/12/greece-was-lying-about-its-budget-numbers/ http://www.forbes.com/sites/timworstall/2011/09/12/greece-wa... I think most of southern Europe should be not in the euro zone at all, their economy would have better time on a weaker currency. http://stephansmithfx.com/articles/how-a-weak-currency-affects-an-economy/ http://stephansmithfx.com/articles/how-a-weak-currency-affec...
- r00fus 11y ago
  > I am not sure if Germany at fault here, bringing in the euro was not forced by them and Greece was cooking the books to get in. s/Greece/people running Greece at that time/ If you asked the who didn't profit from joining the Euro, likely you might have gotten a negative reply. Seriously it's not a fault issue here because multiple parties (including the vampire squids that are multination financial corporations like Goldman) conspired to profit from it. Question is what is going to be done to right the ship and avoid calamity?
  - atmosx 11y ago
    Given the situation, I don't think that Greece has anything to gain from staying in the common currency. After ~ 8 years of Troika mismanagement the country is in dire situation and there has not been the slightest perception of improvement. So even if SYRIZA choose to blink, the next government wont.
- zurn 11y ago
  Singling out Greece's creative accounting in Euro accession as the main problem is blaming the victim here. A lot of the countries did it to some extent, the EU turned a blind eye. And most of Greece's budget deficit happened only after joining the Euro. Greece is despite their own share of f-ups largely a casualty of the systemic problems and EU's failure in handling of the crisis.
  - Bootvis 11y ago
    Come on, they cooked their own books and noone forced them. They may suffer from that now but pointing that out is not 'victim blaming'.
    - gizmo 11y ago
      Spain is also suffering and they didn't cook their books. It was also an open secret that Greece's numbers were manipulated, but the ideal of a united Europe with one currency overruled economic pragmatism. Even if Greece had no corruption at all they would still be in a nearly indistinguishable position. They still would have been flooded with debt (simply a consequence of interest rates dropping during the boom) and they would still get a crushing depression (because that's what happens when you share a currency with larger and economically stronger countries). When Greece joined the Euro the outcome was nearly inevitable, so blaming Greece for this makes little sense. The austerity policies the troika imposed on the Greek people were brutal and completely unnecessary, though. So that's the outrageous part.
fulafel 11y ago
Another good article about the German situation is this post from Simon Wren-Lewis: http://mainlymacro.blogspot.com/2013/11/the-real-problem-with-german.html http://mainlymacro.blogspot.com/2013/11/the-real-problem-wit...

atmosx 11y ago

Germany enjoys the lowest unemployment rate in history, while Greece has a humanitarian crisis and Spain has also extremely high unemployment. That's not a coincidence. > Germany's improvements have more to do with Germany's changes to industrial reform than to do with Southern Europe [...] Then let Greece default (as a Greek I believe that's best for my country in the long term) and see how that plays out. BTW the lack of understanding of 101 macro-economics by Scheuble is disheartening[1]. Every time he speaks, he is comparing economy-wise countries to businesses and/or households, which coming from a FinMin is plain ridiculous[2]. [1] http://www.brookings.edu/blogs/ben-bernanke/posts/2015/04/03-germany-trade-surplus-problem http://www.brookings.edu/blogs/ben-bernanke/posts/2015/04/03... [2] COMPETITIVENESS - A DANGEROUS OBSESSION P. Krugman, 1994, Foreign Affairs Magazine http://www.pkarchive.org/global/pop.html http://www.pkarchive.org/global/pop.html

mkesper 11y ago
Let Greece default ... and see how that plays out. I'm horrified of the carelessness with which that option seems to be considered by the Greek government.
- Someone 11y ago
  I'm not saying it is the best option, but IIRC, the current alternative is to have the country on life support until at least 2050. The Greek government doesn't need to be carelse's to consider a default the better option.
- mcv 11y ago
  It's not a great option, but considering the circumstances, the Greek government doesn't really have a lot of options. Ideally, the debt would be reduced in a controlled manner to a point where Greece can afford to pay off the remainder, but Germany seems to be set on steering towards a Greek default.
- michael2l 11y ago
  A default is a horrible outcome, but "that which can't be paid back won't". It's been pretty clear for a while now that the debt load for the Greek economy is too great and some sort of bankruptcy(default) is required. The ECB and others have conspired to hide this with the collusion of previous Greek leaders, by heaping on more onerous debt and calling it a bailout. It will have to end at some point. What's occurred up until now is fraud with the intent that someone further down the road will have to deal with ensuing mess. But it's likely the game of kick the can will continue.

nisa 11y ago

The Hartz reforms did lower labour costs for some companies and created a huge new segment of low-income workers that have almost no chances to earn a a regular job and besides that temp work was legalized and is largely employed to lower wage costs. This made the exports possible and made a few people rich. A lot of people argue it's unhealthy and will bite Germany in the long term. Besides that: The average german is still far better off than the average greek.

pvaldes 11y ago

This is not really an evidence but maybe you could count as an symptom or even do the test by yourself. TV ads from german companies seem to be everywhere now in southern Europe. You can count three in a row easily and before the scam this was not usual at all. When a company needs to spend more resources in advertising, you can safely infer that they are having some troubles to sell their products.