Germany Has Got It All Wrong

[@contradevian]

Why Britain shouldn't look to Germany as an economic model

http://www.cityam.co...conomic-success

But what about the supposedly great labour market reforms? In fact, they did not really make the labour market more flexible. The OECD has found that legal provisions for permanent labour contracts became less flexible during the Schröder years. Laying off workers is still complicated. Instead, these reforms mainly cut benefits to middle class employees who lost their jobs, putting pressure on them to take up any job, no matter how well it suited their profile.

Ahh its partly down to a lack 'labour market reforms.' Maybe a dose of 'Zero Hour contracts would help or maybe raise fee's for tribunals and make it easier to sack?

This is now being felt by German companies. Highway bridges are in such poor condition that lorries carrying heavy loads often have to make detours, while some transport infrastructure in waterways dates back to a century ago. It is starting to threaten competitiveness in global markets. As a consequence, productivity growth has been anaemic. -

Is that actually true?

Nothing that can't be put right, with a good dose of HPI and a bigger service economy I'd say.

Edited August 2, 2013 by aSecureTenant

[Coffeehead]

There is a weight detour near me in the uk.

[onlyme2]

My toolset contains a shedload of german tools.

Expensive, long lasting, incredibly well designed. Mainly from one private company, no bankrolling (bank undermining), made in a country that vallues engineering and production.

The UK couldn't' emulate Germany even it wanted to any more.

Financial publication concentrating on everything but the bleeding obvious.

[R K]

Right wing rentier mouthpiece decries German social democratic manufacturing/labour model

No sh1t.

[easy2012]

Right wing rentier mouthpiece decries German social democratic manufacturing/labour model

No sh1t.

Emmm... such as the BBC.

The above was more or less featured at BBC Newsnight last week - failing infrastructure, workers who are barely surviving on mini jobs and the wage that stagnant for over a decade.

http://www.bbc.co.uk/news/world-23490232

Otherwise how do you think German can be competitive vs Japan and China.

Edited August 2, 2013 by easy2012

[Errol]

There is a weight detour near me in the uk.

And near me as well. They are everywhere in the UK.

[zugzwang]

Emmm... such as the BBC.

The above was more or less featured at BBC Newsnight last week - failing infrastructure, workers who are barely surviving on mini jobs and the wage that stagnant for over a decade.

http://www.bbc.co.uk.../world-23490232

Otherwise how do you think German can be competitive vs Japan and China.

Given the two examples you use are essentially state-funded pyramid schemes hurtling towards an imminent demise, I'd suggest the Germans merely need to wait a couple years before wiping the floor with them both.

[easy2012]

Given the two examples you use are essentially state-funded pyramid schemes hurtling towards an imminent demise, I'd suggest the Germans merely need to wait a couple years before wiping the floor with them both.

And Germany is not in the midst of a Euro ponzi scheme selling stuffs to 'customers' who can only buy stuff on ponzi credits ?

Most exporters in Japan and China are privately owned though and funded through their revenues.

The banks and real estates part of Germany, Jap and Chinese are the ponzi side of the equation.

We will all survive - it is just a matter of degree.

[Dorkins]

The article is already years out of date now that Germany is at the liftoff stage of its own house price bubble. The ECB will not raise interest rates to cool it as this would lead to mass defaults by southern European banks and governments, in turn bankrupting the northern European banks that lent them the money and destroying the savings of the German 1%ers. At some point in the future the German taxpayer will start bailing out German banks, and HPI will make the German economy as uncompetitive as the UK's.

[@contradevian]

The article is already years out of date now that Germany is at the liftoff stage of its own house price bubble. The ECB will not raise interest rates to cool it as this would lead to mass defaults by southern European banks and governments, in turn bankrupting the northern European banks that lent them the money and destroying the savings of the German 1%ers. At some point in the future the German taxpayer will start bailing out German banks, and HPI will make the German economy as uncompetitive as the UK's.

I don't know anywhere that is safe anymore housing wise. Perhaps move to Spain or Germany and get myself a Blackstone owned social flat.

[Sour Mash]

And near me as well. They are everywhere in the UK.

Another 'me too' on weight restricted bridges being quite common in the UK ... although generally they are not bridges serving main roads.

Based on what I've seen when travelling through Germany, they have excellent infrastructure. Although I was disappointed that the Autobahnen weren't some sort of 'motorways on steroids' as one might imagine from their near legendary status in the world of driving magazines and forums, quite often just fairly ordinary dual carriageway and only unrestricted in certain sections. Much better German driving standards ensured better traffic flow and less stressful driving though.

[Sour Mash]

The article is already years out of date now that Germany is at the liftoff stage of its own house price bubble. The ECB will not raise interest rates to cool it as this would lead to mass defaults by southern European banks and governments, in turn bankrupting the northern European banks that lent them the money and destroying the savings of the German 1%ers. At some point in the future the German taxpayer will start bailing out German banks, and HPI will make the German economy as uncompetitive as the UK's.

Will the German public be as stupid when it comes to rocketing property prices though? One of the things about the bubble in the UK and Ireland that made it so devastating is that the thicko general public and mass media absolutely loved it when it was happening, making it a political imperative to keep the ball rolling on ever-more unaffordable housing.

The Germans have a strong folk memory of the Weimar-era hyperinflation. They might not be so gullible as to see rapidly inflating prices of an essential as a good thing.

[Goat]

It'll be interesting to see how well German industry fares if/when the Euro fails and they can no longer benefit from an artificially low exchange rate.

[easy2012]

It'll be interesting to see how well German industry fares if/when the Euro fails and they can no longer benefit from an artificially low exchange rate.

They survived the DM days (though towards the end of it, it suffers recessions). They will survive, it is just a matter of degree...

[billybong]

..while some transport infrastructure in waterways dates back to a century ago

UK transport infrastructure in waterways being so modern and all.

[billybong]

But all this would not have mattered had Germany not been lucky with its manufacturing portfolio. The specific combination of capital goods, luxury cars, and chemicals, produced by German firms for decades, fitted well with demand from fast-growing emerging markets like China, Brazil, and Russia, which have powered the world economy for the past decade.

So it's just been a fluke. Lucky Germany.

And the UK "portfolio" fitting into which demand is?

.

[@contradevian]

So it's just been a fluke. Lucky Germany.

And the UK "portfolio" fitting into which demand is?

.

banking, houses (not building, but selling/renting to each other) and barista'.

Seem to recall someone called Gordon Brown telling the Germans how to run an economy properly. That worked out well.

Edited August 2, 2013 by aSecureTenant

[billybong]

For Britain, there is little to be copied from German policies. Strong wage restraint is not necessary, as improved international competitiveness can be more easily achieved through the weakness of sterling.

So that's what it's all about.

It's never worked before for the UK.

More propaganda for the failed policy of a weak sterling. A policy that's been tried by the UK repeatedly and that's failed again and again and again to the devastation of the UK economy - but still the easy money VIs want to repeat it.

The article itself represents one of the fundamentals wrong with the UK.

Edited August 2, 2013 by billybong

[pathfinder]

This is now being felt by German companies. Highway bridges are in such poor condition that lorries carrying heavy loads often have to make detours, while some transport infrastructure in waterways dates back to a century ago. It is starting to threaten competitiveness in global markets. As a consequence, productivity growth has been anaemic. -

The reason Gubberment is peddling lets invest in infrastructure is because it is now actively involved in the sector via zombie banks. Screw the private sector the State wants a slice. Welcome Comrade to the State owned private company working for the State.

In exchange for releasing £87m of the cash Mouchel owes, the banks - Lloyds, Royal Bank of Scotland and Barclays - will receive a controlling stake in the company as a result of the deal, which is subject to the approval of shareholders.

http://www.londonlovesbusiness.com/business-news/business/lenders-set-to-take-control-of-mouchel/3101.article

Edited August 2, 2013 by pathfinder

[onlyme2]

Germany's manufacturing and Equipment -sectors ----

http://www.gtai.de/GTAI/Content/EN/Invest/_SharedDocs/Downloads/GTAI/Industry-overviews/industry-overview-machinery-equipment.pdf

With global machinery trade share

of around 17 percent, Germany’s

M&E industry sector is the lead-

ing supplier of machinery, ahead

of both the USA and Japan. German

machinery and plant manufactur-

ers are world market leaders in 16

out of 33 M&E sectors. Seventy-six

percent of machinery turnover is

generated from sales to interna-

tional clients (the machinery trade

surplus amounted to EUR 88 billion

in 2011)

[easy2012]

UK transport infrastructure in waterways being so modern and all.

No worry.. HS2 will be the flagship...

Edited August 2, 2013 by easy2012

[billybong]

The media outside Germany has developed a nice narrative to explain how the former “sick man of Europe” turned into a new economic powerhouse. According to this narrative, in the early 2000s the German economy was stuck in recession, burdened with a huge welfare state and a sclerotic labour market.

Germany the "sick man of europe". What a laugh.

Maybe called that by the UK media narrative but in reality it managed to absorb East Germany in a few years and helped because it had a healthy economy to start with. A healthy economy developed over decades (an economy constantly put forward in the UK media as one to be emulated in the years before the Berlin Wall fell).

In contrast powerhouse UK shed empire and the Union started to move apart.

The article says Germany has "a huge welfare state and sclerotic labour market" and in contrast to the UK - more laughs.

Edited August 2, 2013 by billybong

[Oliver Sutton]

even after the spending boom of the Blair-Brown governments, British infrastructure still leaves a lot to be desired.

So there was a spending boom on infrastructure during New Labor !

Joke article.

[whitemice]

Sounding in from HPC listing post Düsseldorf:

• Transport infrastructure in Germany is first rate where it counts (a lot of heavy/bulk stuff gets shipped by river, etc). Autobahns should not be confused with the mega highways found commonly in the US.
  
• German HPI has been kicking off for a number of years now. German TV is pretty dire at the best of times (not worth learning the language for), and not made better by the recent influx of property porn shows.
  

[Guest eight]

There is a weight detour near me in the uk.

There's a detour near me because a whole road collapsed into a river and nobody has the first clue how to fix it.

The nearest available diversion has also had to be closed due to the wear and tear.