Sunday, Dec 21, 2008
Selected quotes
Telegraph: Germany is already collapsing
The German economy is on the "brink of the abyss".
We are reaching depression levels here.
This is an industrial melt-down.
Posted by gardeniadotnet @ 10:23 PM (855 views) Add Comment
14 Comments
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1. mark wadsworth said...
Tee hee, on a totally counter intuitive basis, it can easily be argued that the UK, is, despite what The Goblin King says*, relatively well placed (using relative to mean exactly that) to'withstand a recession'.
* Yes, I know he keeps on saying it, but as he is normally lying about everything, that makes me tend to believe the opposite.
2. gardeniadotnet said...
The Romans' version of inflation didn't involve paper money, but it was immensely destructive of value, all the same, and I suppose that it was an early experiment in "quantitative easing". The silver denarius was replaced in circulation by the larger silver antoninianus, but it didn't take long for people to work out that the silver content of the new coin was actually less than that of the old one. To feed the government spending of the day, though, the mints needed to continue to create antoniniani, so the silver content fell to zero, the coins merely being dipped in silver, which quickly wore off. A coin of, say, Carinus, today looks like a lump of pure copper, because that's basically what it is. Since the whole point was that silver had a greater value than copper, the purchasing power of the antoninianus fell through the floorboards.
Owen_Morgan
3. japanese uncle said...
UK can never afford to banter German economy being on the 'brink of the abyss'. Do they have 1.5 trillion personal debt? Did they have arguably the biggest housing bubble in history? Don't they keep arguably the highest quality manufacturing sector on earth? If the Germans are on the 'brink of the abyss', UK is on its way to the bottomless pit.
4. gardeniadotnet said...
The modern currency system allows the central banks to fund the grandiose expenditure of government by the same means, THEFT.
The central banks call it 'seignorage', an infinite blank chequebook. It's a very posh word for counterfeiting. The result is the same. Instead of raising taxes, government uses inflation and monetary debasement to steal the peoples' wealth to pay for its wars and social engineering. It's the worst kind of stealth taxation because people don't realize its happening and they don't understand the mechanisms by which the state funds itself.
UK Debt Slave
5. gardeniadotnet said...
@ju
Surely you realise by now that this disaster transcends national boundaries?
6. bellwether said...
JU your view is certainly received wisdom on the site but you don't address the points made in the article, essentially if consumption collapses the overheads that are needed to run an production/export economy becoming a crushing burden. The strength of the Euro linked to ECB obsession with inflation isn't helping. Surpluses can evaoprate very quickly as Japan discovered.
7. gardeniadotnet said...
@ bellwether
What do you think of the ECB's recent action?
ECB moves to boost interbank lending
Standing-facility changes aimed at reducing euro deposits
The European Central Bank on Thursday moved to jump-start lending between banks by announcing it would effectively lower the interest rate it pays on overnight deposits while raising its emergency-lending rate.
8. japanese uncle said...
ECB's stupidity (coordinated with other central banks in reality) is one thing, rigidity of German economy (not immune to the global downturn, though) is another.
9. gardeniadotnet said...
Going forward ( I just love that expression), how quickly will we come out of the other side of 'the crash'?
Predictions are welcome on both a local and global basis.
10. gardeniadotnet said...
Link for ECB post above:
http://www.marketwatch.com/news/story/ecb-seeks-squelch-overnigh-euro/story.aspx?guid={D8E70CC5-4C4F-49E4-9A78-907AE54BEB3E}
11. Hammertime said...
What "rigidity" of the German economy?
Even with people in other countries borrowing crazily to buy their wares it was an economy that could barely keep their people in jobs or rich enough to reproduce at anything approaching a replacement rate.
12. Alan Lubin said...
seriously. i didnt even need to look at this article to know who had written it.
13. Troy said...
here's a short Bloomberg video on the outlook for the German economy from the clip syndicate
(makes a change from youtube)
http://www.clipsyndicate.com/video/playlist/1778/773529?title=Bloomberg
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