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Eu To Germany - Stop Being Successful, It's Illegal

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http://www.telegraph.co.uk/finance/economics/10980824/Juncker-faces-political-test-as-fines-loom-on-illegal-German-trade-surplus.html

Exporting more than you import, saving for the future, being more efficient than other countries, that's illegal don't you know! Why does Germany still want to be a part of this ridiculous organisation? It makes no sense.

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There is no such thing as savings - it is all debt. So Germany's surplus is the debt of the rest of the EU (which partly caused the crisis). The reason Germany wants to stay in the EU is to benefit from the Euro which is far lower than what the Deutschmark would be and makes them competitive. Essentially Germany is exporting mass unemployment to Club Med via an artificially cheap currency.

The real question is, why is Club Med willing to sacrifice its youth on the altar of German pensions?

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yes, the Germans want the Greeks to be able to borrow cheaply (on the back of being a member of the Euro) in order to buy themselves a shiny new BMW regularly

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There is no such thing as savings - it is all debt. So Germany's surplus is the debt of the rest of the EU (which partly caused the crisis). The reason Germany wants to stay in the EU is to benefit from the Euro which is far lower than what the Deutschmark would be and makes them competitive. Essentially Germany is exporting mass unemployment to Club Med via an artificially cheap currency.

The real question is, why is Club Med willing to sacrifice its youth on the altar of German pensions?

To prevent ww3? . Oh and so older club med Europeans can drive around in what would otherwise be prohibitively expensive Mercedes Benz' also something about "competing with the china, USA and India?

Looks like the Germans got their little empire in the end.

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Surely this can be fixed by charitable donations to the struggling EU countries to pay off their debt?

This would fix lots of the EU's issues all at once

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after ww2, many Germans didn't want to be German any more but 'European'. What's annoying is that the EU could work if they managed these surpluses properly, just like the USA can. Language barriers and cultural differences mean we'll never be a USE but now we have a terrible halfway house between proper nation states and a proper federation.

It would be better if the pro EU people were honest about this rather than Clegg saying the EU would be more or less the same in his debate with Farage so we can have the debate and go back to one system or the other

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The global economy has become like a drug pusher who lends money to his addicts so they can keep getting their fix. One day the pusher will run out of money to lend, the addicts will get mightily peed off and probably lynch him while going cold turkey.

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Surely not as bad as London distorting the UK.

At least Germany's wealth is, by and large, honestly earned. Contrast London, rich on the back of government and financial services whose game is very largely parasitic on the real economy.

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There is no such thing as savings - it is all debt. So Germany's surplus is the debt of the rest of the EU (which partly caused the crisis). The reason Germany wants to stay in the EU is to benefit from the Euro which is far lower than what the Deutschmark would be and makes them competitive. Essentially Germany is exporting mass unemployment to Club Med via an artificially cheap currency.

The real question is, why is Club Med willing to sacrifice its youth on the altar of German pensions?

Our current economic system says that surpluses (producing more that you consume) is bad.

A read of history books says that a wise survival strategy is to produce (and stockpile) surpluses.

... which suggests to me that "The Economy" is currently an incomplete model of how real life works, and that tweaking the rules that govern how the economy works is the appropriate answer?

Edited by DeepLurker

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They have a chronic demand deficit. They need to address it.

it gets worse.

deutsche bank alone is on the hook for something like $2TRN in derivatives.

this is one game of pass the parcel they are desperately trying to shift as quickly as possible, because the parcel contains high explosives.

they know, they've been playing the game and want to bail out early(hence the decision also to remove themselves from the london gold fix etc)

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Our current economic system says that surpluses (producing more that you consume) is bad.

A read of history books says that a wise survival strategy is to produce (and stockpile) surpluses.

... which suggests to me that "The Economy" is currently an incomplete model of how real life works, and that tweaking the rules that govern how the economy works is the appropriate answer?

depends how the surplusses are made.

if it is done through hard graft and expertise( of which the germans were always actually pretty good anyway), it's ok

if it's done through industrial espionage,fraud and deceit(which includes financial/legislative jigger-pokery to land your competitors in doo-doo) then it is not.

germany has played this game about 50/50 on both sides.

they've got the ability to innovate themselves out of the mess, but will not be walking away entirely unscathed.

..and one of the things about empire building they need to yet learn, is that consensus and comprimise are sometimes more useful than riding roughshod over everybody.

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To prevent ww3? . Oh and so older club med Europeans can drive around in what would otherwise be prohibitively expensive Mercedes Benz' also something about "competing with the china, USA and India?

Looks like the Germans got their little empire in the end.

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Generating ongoing surpluses is gaming the system.

If they weren't in a currency union the DM would strengthen and they would stop exporting unemployment/excess supply to other nations.

They should of course recycle these surpluses either by increasing demand by consuming more of their neighbours products/services, by increasing wages to reduce their competiveness, or by some form of Marshall Plan to support the economies they are gaming.

There ought to be nothing controversial in that. They're cheats and ought to be exposed as such!

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That is not true any more. Not in a world of globalised capital flows. Witness the UK.

The currency exchange as the means of rebalancing trade and money is no longer effective - not until you have sold your country to your suppliers.

Of course it is.

But adjustments often take time.

UK, to quote your example, ain't set up to sell manufactures as much anymore so it takes a while for a sustained lower currency to encourage a redeployment of capital.

UK of course has been 'exporting' prime real estate instead of manufactures. Same difference.

US, for instance, is now exporting oil and their trade deficit is closing. They're further along the road of increasing their manufactures relative to China as the Renminbi exchange rate has risen. These things take time though clearly.

Edited by R K

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Generating ongoing surpluses is gaming the system.

If they weren't in a currency union the DM would strengthen and they would stop exporting unemployment/excess supply to other nations.

They should of course recycle these surpluses either by increasing demand by consuming more of their neighbours products/services, by increasing wages to reduce their competiveness, or by some form of Marshall Plan to support the economies they are gaming.

There ought to be nothing controversial in that. They're cheats and ought to be exposed as such!

why do you think they want Britain in the EU, so that those countries can export their unemployed.

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There is a lot of rubbish spouted about Germany in these forums. Germany produce far more than just cars. The Germans produce world class products in niches such as making hinges all the way to farm machinery and chemicals. They export their products right around the world, not getting rich by forcing the populations of Southern Europe to buy their cars. Sure they do buy their cars, but in the grand scheme of things they are a drop in the ocean.

Germany was a powerhouse in manufacturing when it had the DM. The Euro may have made it a bit easier for Germany, but it actually exports about two thirds of its products to countries either outside the EU or outside the Eurozone.

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There is a lot of rubbish spouted about Germany in these forums. Germany produce far more than just cars. The Germans produce world class products in niches such as making hinges all the way to farm machinery and chemicals. They export their products right around the world, not getting rich by forcing the populations of Southern Europe to buy their cars. Sure they do buy their cars, but in the grand scheme of things they are a drop in the ocean.

Germany was a powerhouse in manufacturing when it had the DM. The Euro may have made it a bit easier for Germany, but it actually exports about two thirds of its products to countries either outside the EU or outside the Eurozone.

Ok- now imagine a world made up entirely of export powerhouses who each suppress local demand by keeping their workers wages relatively low- who buys all those exports? This is not a game everyone can play- that's the point.

So by refusing to reciprocate in terms of consumption Germany is gaming the system globally as well as within the EU- but it's especially hypocritical for them to game their EU partners in my view- and to do so from behind a screen of holier than thou rhetoric about the evils of running a deficit- given the fact that those deficits are in part a consequence of German policy.

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Ok- now imagine a world made up entirely of export powerhouses who each suppress local demand by keeping their workers wages relatively low- who buys all those exports? This is not a game everyone can play- that's the point.

So by refusing to reciprocate in terms of consumption Germany is gaming the system globally as well as within the EU- but it's especially hypocritical for them to game their EU partners in my view- and to do so from behind a screen of holier than thou rhetoric about the evils of running a deficit- given the fact that those deficits are in part a consequence of German policy.

The Germans themselves do buy lots of their own products and import lots too. Germany makes imports worth over Euro 1.2 trillion per year, and exports about Euro 1.5 trillion.

Edited by BalancedBear

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There is a lot of rubbish spouted about Germany in these forums. Germany produce far more than just cars. The Germans produce world class products in niches such as making hinges all the way to farm machinery and chemicals. They export their products right around the world, not getting rich by forcing the populations of Southern Europe to buy their cars. Sure they do buy their cars, but in the grand scheme of things they are a drop in the ocean.

Germany was a powerhouse in manufacturing when it had the DM. The Euro may have made it a bit easier for Germany, but it actually exports about two thirds of its products to countries either outside the EU or outside the Eurozone.

Yep, machine tools, power tools - two fo the best brands in the world, the list is very long.

As for exchange rate - helps them a bit but at the quality end products will still sell regardless.

Some German brand power tools retail for 10x the copycat chinese clone products (legitimate copies of out of patent protection), but still sell very well. A tool you can rely on and that is more accurate is worth the difference.

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As for exchange rate - helps them a bit but at the quality end products will still sell regardless.

The odd part is that, over here, German cars are extremely expensive compared to American and Japanese, and everyone says not to buy them because they're so unreliable and expensive to maintain after the warranty expires. I'm surprised every time I see one on the road.

OK, a lot of them are made in Mexico, but I believe quite a few are still imported from Germany.

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why do you think they want Britain in the EU, so that those countries can export their unemployed.

Germany has more immigration than the UK. It even takes unemployed Brits.

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Ok- now imagine a world made up entirely of export powerhouses who each suppress local demand by keeping their workers wages relatively low- who buys all those exports? This is not a game everyone can play- that's the point.

So you think if everyone in the world was better trained and worked harder and invested to make better products every year, we would globally all be poorer? Presumably if we all work less and make things a bit crapper, we will all get richer? That's sounds almost as appealing as selling piles of brickks to each other a ever increasing prices. Who said there was no plan B? We'll be rich, I tell you. Rich!

Edited by BigPig

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Ok- now imagine a world made up entirely of export powerhouses who each suppress local demand by keeping their workers wages relatively low- who buys all those exports? This is not a game everyone can play- that's the point.

So by refusing to reciprocate in terms of consumption Germany is gaming the system globally as well as within the EU- but it's especially hypocritical for them to game their EU partners in my view- and to do so from behind a screen of holier than thou rhetoric about the evils of running a deficit- given the fact that those deficits are in part a consequence of German policy.

Rubbish - it's perfectly possible to consistently produce an surplus of what you need, and then trade that surplus with other people producing surpluses of what they need to improve your quality of living.

If no-one is interested in trading for your surplus, then you simply reduce the amount of work you put in and only produce what you need, leaving you with spare capacity to use as you please.

What's NOT possible is to consistently fail to produce what you need and then to borrow in order to get someone else's surplus.

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So by refusing to reciprocate in terms of consumption Germany is gaming the system globally as well as within the EU- but it's especially hypocritical for them to game their EU partners in my view- and to do so from behind a screen of holier than thou rhetoric about the evils of running a deficit- given the fact that those deficits are in part a consequence of German policy.

Germany doesnt owe europe or the rest of the world a living.

Its success is down to the fact that its workforce are more productive hence a euro spent on german goods buys you more than the same euro spent on greek goods (or brittish ones or .. whoever) which is why greek people buy german cars. No country has a moral duty to turn away trade so if the PIGS buy german goods rather than learn how to make them as efficiently themselves then any pain that causes is entirely their own fault (as it will be ours for doing the same thing).

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