German Economy Slumps, Key Indicators Fall, Underlines Eurozone Economic Decline

With zero growth in the German economy over the final quarter of 2019 as manufacturing remained in a slump and exports fell, the wisdom of Britain’s middle and working class voters choice to leave the failing European Union was vindicated again. The German figures highlight the many challenges facing the Eurozone, which is hamstrung because it consists of 19 different economies (eith of them economic basket cases,) all needing very different solutions.

German’s state statistics agency reported today there was zero growth in the fourth quarter and a mediocre 0.6 percent increase for the whole year. And that paltry figure has only been achieved with the help of financial jiggery pokery from the European Central Bank (ECB)

Germany´s troubles are central to the economic difficulties of the 19-country eurozone economy and the European Central Bank, which has for several years been trying mask the reality of flagging growth and inflation with negative interest rates and newly printed money. Germany has been a manufacturing and export powerhouse in recent years and has propped up the rest of the sigle currency zone, but with German manufacturing in the doldrums and exports rendered uncompetitive due to increased costs imposed by ineffective and pointless “green” policies imposed on member states by Brussels, those areas have been sluggish and only debt funded consumer spending has kept the country out of recession. But debt funded spending is only ever a short term solution.

Carsten Brzeski, chief economist at ING Germany, told a German Financial Newspaper, “In general, the German economy remains stuck between solid private consumption and a paralyzed manufacturing sector.”

Slowing global trade and the uncertainty caused by the U.S.-China conflict over trade have been one problem. Another is structural change in industry, particularly the auto business, where companies must sink billions into developing electric cars and new services based on smartphone apps, both to meet regulatory pressure for lower greenhouse gas emissions and to head off competition from from the tech sector.

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Germany’s ruling party split over how to respond to AfD

Germany’s Christian Democrat party (CDU) is as deeply divided as Britain’s Labour Party over how to respond to the upsurge of nationalism. Facing a serious challenge from the nationalist (but not far right please, they are not that,) Alternative for Germany party (AFD) the CDU seems pitifully unprepared for departure of the Chancellor Merkel at a point when Germany its facing most serious political and economic crisis for decades.

191221-german-green”>
German Green Party Urges Allowing 140 Million “Climate Refugees” To Migrate To West
The Green Party in Germany is currently putting forward as a policy that up to 140 million “climate refugees” should be allowed to migrate to the west and given citizenship. The question of where we would put 140 million people and what we would do with them is of course deflected. And the case that the 50 million climate refugees that were predicted tTo descend on the west, having been displaced by rising sea levels are apparently all hiding under Harry Potter’s Cloak of Invisibility is ignored.

Germany sliding into ‘dangerous’ anti-Europe hysteria warns top economist
As Germany’s economy continues to stutter one of the country’s top economists has warned the country is desending into “anti-Europe hysteria” amid growing criticism in the country of the European Central Bank (ECB) and surging support for the Eurosceptic, anti – immigration AfD Party.

Germany sliding into ‘dangerous’ anti-Europe hysteria warns top economist

As Germany’s economy continues to stutter one of the country’s top economists has warned the country is desending into “anti-Europe hysteria” amid growing criticism in the country of the European Central Bank (ECB) and surging support for the Eurosceptic, anti – immigration AfD Party.

Germany Heading For Political Instability After EU Elections?
it may be premature to write off the AfD because it is entirely possible their supporters suffered a bout of apathy with regard to the European Parliament, being aware the European Commission will not allow any nationalist grouping to gain influence in the parliament, the Left made some astonishing gains at the expense of Merkel’s CDU and its coalition partners the CSU and SDP. The always fragile coalition is now in even more trouble …

 

Currency Wars: Former UN Under-Secretary-General Calls For One World Currency

In this page, we have covered US attempts to expolit its position as issurer of the global reserve currency, and the moves by China and Russia to resist that. Moves to establish the US$ as a true global currency began a long time ago with the creation of the International Monetary Fund at the Bretton Woods conference in the final months of World War 2, with Germany defeated and the world ready to split into capitalist and communist factions…

German Alarm Grows Over EU Determination To Punish Britain For Leaving
The business community and conservative politicians in Germany are becoming more annd more hostile towards the way Brussels is trying to force the UK Parliament to accept the Brexit Withdrawal Agreement as a fundamental failure of European statecraft that can lead only to a diplomatic catastrophe and long term animosity between the EU and one of Germany’s largest expot customers.

German Alarm Grows Over EU Determination To Punish Britain For Leaving
The business community and conservative politicians in Germany are becoming more annd more hostile towards the way Brussels is trying to force the UK Parliament to accept the Brexit Withdrawal Agreement as a fundamental failure of European statecraft that can lead only to a diplomatic catastrophe and long term animosity between the EU and one of Germany’s largest export customers.

 

EU Very Good for Germany, Not So Much for Everybody Else

 
Former Ambassador to Germany Sir Paul Lever said in an interview today that Brexit will have little real impact on the European Union (EU), which is overwhelmingly controlled by Germany. Short term he may be right, but with the German economy stalling what will prop up the Brussels cash burning machine one britain is gone?

Germany: Economy crisis as growth stalls – car production crashes
Germany’s federal Government today reduced its growth forecast for the second time in two months as plunging car production figures sent shockwaves through the Eurozone. The German economy, has been propping up the economically stagnant EU for years…


Brexit has terrified ‘Brussels bubble’ – German insider

The EU elite “lost faith in their own appeal and abilities” following the Brexit referendum vote and the surge in support for nationalist parties. The knee jerk response of the Brussels bubble was to try (and fail) to punish Britain for defing Brussels in the same way as they had punished small nations like Greece, Portugal and Ireland, which in their perception was the only way to prevent the EU breaking apart.

Full Catalogue Of Posts On Germany

Cracks In EU Unity Facade Are Beginning To Show

Coincidental with the bizarre events in the UK’s Supreme Coirt, where judges tried to usurp the power of parliament to themselves in a globaloist bid to stop Brexit, the economic situation in Europe, which as we have reported many times is dire, has entered into a critical period.  With one of the two net contributors o the EU treasury about to leave,Germany, which for decades has propped up the bloc financially as more and more economic basket cases were absorbed into Brussels’ wannabe empire, has stumbled into if not actually a recession then something very like one

Year on Year (YoY) growth in the German economy, from July 2018, July 2019 is 0.4% – what you would expect in the middle of a depression, and significantly less than the official inflation rate (while the real rate of inflation is, predictably, higher still. UK growth figures are slightly better coming in at 1.2%. Poor old Italy recorded a GDP growth of -0.1% YoY, (that’s a minus sign by the way).

Italy has a Debt-to-GDP ratio of 132% and finally France with a growth rate of 1.4% and a debt-to-GDP of 97% is effectively broke. That’s the big four in the EU/Eurozone.

So, the biggest economies in EU/Eurozone have a growth rate ranging from -0.1% to 1.4%. Oh, and I almost forgot negative interest rates are now becoming the norm in The Eurozon and 85% of German Bunds are non-performing and/or at negative interest rates.

Inexplicably the ECB is getting geared up for another round of QE, which means that the euro is going to be devalued. Of course, the Americans aren’t going to be best pleased with this turn of events but doubling down on the policy that failed is par for the course with the EU. Only a few years ago they decided the way to resolve the problem of mass immigration was ………… more mass immigration, and are currently proposing more politicalintegration of member states to counter the resurgence in nationalism triggered by …………….. wait for it ………………. forcing political integration on member states.

By failing to support US trade tariffs on nations that have pissed off Washington, the EU has involved itself peripherally in the US tade war with the world. but this can onlu=y increase problems. Germany in its present economic travails, and lined up to take the biggest economic hit from Brexit, is not going to welcome any increased costs for its export industries.

Most importantly this includes the cost of the raw material essential to Germany’s manufacturing/export sector. Natural Gas and oil are piped to Germany from Russia and the construction the of Nordstream 2 pipeline, which the US wants to alt to put Putin in his place, is crucial to the German economy. America wants to force Germany to buy more expensive, less reliable, Liquified Natural Gas (LNG) by taking alternative suppliers out of the picture and is threatening to impose sanctions on any company and/or state to get their own way.

GERMANY’S ENTSCHEIDUNGSZEIT (DECISION TIME)

This is a clearly a case of “deja vu all over again” and a moment of truth for the Germans. Do they do what the Americans tell them, which would be economic suicide, or will they pursue their national interests and give Uncle Sam the finger. This was precisely the setting in 1985 though with Japan then the object of US financial and economic destabilisation.

The Plaza Accord was a joint-agreement, signed on 22 September 1985, at the Plaza Hotel in New York City, between France, West Germany, Japan, the United States, and the United Kingdom, to devalue the U.S. dollar in relation to the Japanese yen and German Mark. The resulting recessionary impact which pushed up the value of the Yen against the dollar in Japan’s export-dependent economy.

This created an incentive for the expansionary monetary policies that led to the Japanese investment bubble of the late 1980s. The Plaza Accord triggered the Japanese asset price bubble, which progressed into a protracted period of deflation and low growth in Japan known as the first Lost Decade. Has Germany, and by implication Europe learned the lesson one wonders?

Bearing this in mind it should also be noted that Germany is a big investor in Russia.

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An Avalanche Of Upshitcreekness

argentina default

We are kind to our readers here at Boggart Blog, we give you lots of new and very amusing words like upshitcreekness to play with when you are trying to describe the state of the world. Upshitcreekness describes no only how far up shit creek we really are, the depth of the shit beneath our canoe, the conspicuous lack of a paddle and the stinkyness of our surroundings.

The reason we invented upshitcreekness today is to adequately describe the situation in high finance following the debt default by Argentina and the collapse of Portugal’s Banco Espirito Santo this week. “But do those affect us, Ian?” You might well ask.

Not directly or immediately, but they demonstrate that in spite of all the blether from mainstream media, the debt crisis and the fragility of banks’ balance sheets has not gone away. There is no recovery.

“But haven’t Whitehall and Washington been pumping out data that shows a strong economic recovery is underway, everybody now has fourteen jobs, wages are rising and prices are falling and everything is hunky dory because that nice Mr. Rothschild lent us the money to sort it all out.

Well the numbers that they crank out to make everybody feel good are almost as phony as the numbers that the Argentine government has been cranking out for the past few years. Cristina Fernández the government finance chief says well, we only have 10% inflation. But everybody knows that a broad snapshot shows for necessary purchases it’s 30 to 40%. And here they say we have 2% inflation. I would say that based on a household budget (which excludes luxury goods that are being heavily discounted because nobody is buying) inflation is realistically in the 8-10% range here, and in the USA it’s going much higher because the US$ has been dropped by many trading and oil producing nations as the currency of bilateral trade. This has been going on for a while but contracts are made eighteen months to two years in advance so the effect does not kick in at once.

If we observe the actual economy rather than the fiat money and quantitative easing economy it has been obvious for a while that the upshitcreekness was being masked by printing money and statistical prestadigitation.

The growth is all a fantasy. It’s all a result of the assumption that there is no inflation, when there really is because what we have is inflation masquerading as economic growth. But the bottom line is the economy is really contracting, although jobless figures are massaged by simply not counting the long term unemployed and counting those in part time jobs as having a whole job and not a fraction of a job, the labour force is actually shrinking. GDP may be growing but that’s only because the government keeps printing money and handing it out in benefits, there is actually less economic activity. That’s why we’re using less energy, that’s why the people’s standard of living is going down, and real incomes are falling and job opportunities are disappearing. It’s because we’re in a recession, a depression even, and no one wants to admit it.

And as in 1939 the leading economic powers see war as a way out, which is why the USA and its allies are madly angling for war in Ukraine.

And if there’s a war we’re fucked, I’m fucked, you’re fucked, we’re all fucking fucked. That’s what is meant by Upshitcreekness.

Well that’s the external threats dealt with, noe we need to deal with the enemy within (the EU)

If The Government Does Not Keep Junkhead Junckers Hands Off The City, we can say gooodbye to nationhood.

Yes, thanks to economic mismanagement by Conservative and Labour governments since the 1960s we are far too dependent on our financial services business. And the money hungry bureaucrats of the EU have coveted the revenue that brings in for many years.

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Economic Recovery or The Return Of Insanity?

Remember the insanity of Labour’s economic boom when Gordon Brown and Gauleiter Ed Bollocks masked from us the fact that we were already up to our necks in rising shit by forcing property prices up with easy credit, letting bankers trade toxic debt and telling us the economy was actually growing. And remember how some economic genius in the Treasury, backed by a fuckwit economic genius called Krugman who knows less about economics that a turd said the only way to reduce a crippling deficit is by offshoring all our manufacturing industry, inviting mass immigration to a land with no jobs to offer and borrowing shitloads of money that we could not repay (coz the economic genius who apparently won a Nobel prize for fuckwittery economics said if you let in a few million immigrations, and pay them benefits then they spend money in the UK economy and it creates growth).

Well the insanity is back. There are several reasons, first there is an election in the offing so the economy needs to be talked up. Second, the same fuckwith economists as advised Labour prior to 2010 are advising the coalition now and giving the same bad advice. Third, there is another economic crisis looming and the only way to delay it until the elite have got all their assets converted to gold or commodities is by inflating a new debt bubble. Inflation isn’t really down, unemployment isn’t really improving, and silly interest rates having failed to stimulate the economy are still crippling pensioners and savers.

Now only an economist or a Labour politician (they’re more elitist than the Tories you know) could be fuckwitted enough to think GDP is reliable measure of economic performance. It measures money churning in the economy, not money being made. For a picture of how insane the system is, read Creating Wealth in which I explain how the illusion of economic growth works. I tried to make it simple enough for even a Politician or University Lecturer in economic to understand.

but if that is too difficult, here’s a clip from the 1986 move Back To School in which Rodney Dangerfield pays a self made millionaire who goes back to school to complete his education. In this scene Dangerfield’s character finds himself having to explain the realities of life to a cupid stunt of an economic lecturer who has spent all his life studying the “theory” of business and never held down a real job in the real world. If you are a sane person, you’ll enjoy this but if you think what the country really needs is another dose of fuckwit economics then you should not even be in my site. GET OUT NOW!

The reason I am posting this dire warning is that at a property auction last week a large garage in Camberwell (London) – somewhere to put a car at night, that is, not a repair business or petrol station – was sold for £550,000, having been put on the market by Southwark council as a “development opportunity”. A man from property website Zoopla told the Financial Times that “the buyer could create a significant return despite paying what seems like an extortionate premium today”.

In other words, if you own a shed you are probably richer than you think, just watch globalised capital’s alchemy turn rotten wood into gold. but don’t wait to long before cashing in your chips.

Experience should tell us that even if George Osborne’s property bubble is lifting prices all over the UK as the Brown Bollocks boom did between 2002 and 2010, London has long since left everywhere else on the ground. Over the past year, property values in the capital have risen by 18% and the gap between prices there and the rest of the UK is the biggest since records began. The average monthly rent in London is now £1,125. A garage can sell for half a million in London, you can buy a two bedroomed terraced house in reasonable condition in a not too bad street in Blackburn or Burnley for £25,000 (you can actually buy a “development opportunity” for £2000.

The cost of a house in London and the south east is now beyond all but the wealthy. The cost of a house in most parts of the midlands and north is beyond couples on average income. So who benefits from a property led boom? The bankers, that’s who. The finance industry not only fixes economic policy in its own interests but also sucks up public investment. The dire political consequences of this are all around us, though a capital-focused media often fails to see them. But the truth is we are now in a worse state due to economic mismanagement than we were in 2010, 2008 and 2001, in the wake of the last three crashes.

And the conservative politicians tell us they are doing well, and the Labour politicians tell us they would do better by repeating all the mistakes they made during thirteen years of misrule between 1997 and 2010.

We’re fucked. Vote UKIP.

Bagpipe Music Accompanies The Highland Reel Of Economic Decline

Bank of England Chief Mervyn King warned “The global economy is running out of time.”

Britain is at risk from a deepening crisis in the world economy and we are running out of time if we want to do anything about it, the Governor of the Bank of England warned in another virtuoso performance of stating the effin’ obvious..

Despite central bank interest rates having been held so low for three years that us poor taxpayers now pay foreign banks to borrow from us, an economic stimulus programmed that used “quantitative easing” (effectively printing money) in an attempt to not stimulate the economy even a teeny bit (the banks borowed all the QE money at 0.5% and loaned it staight back to us at 3.0% and other emergency measures like paying people to buy new cars Mervyn King warned that governments had not yet addressed the underlying problem of overspending that was at the root of the financial crisis..” The consequences threatened to inflict pain on everyone”, he said. Threatened?

THREATENED?

What is the stupid arse belthering on about, threatened. The crisis has been inflicting pain for three years. A medieval torturer wearing a sudded codpiece and a gimp maSks would be hard pressed to inflict more pain that the policies of this government and the last one have. I’s time for a dose of reality and once again, as the direness of the latest economic figures sinks in, I am reminded of these words from the poem Bagpipe Music by Louis MacNeice

The glass is falling by the hour,

the glass will fall forever,

but if you break the bloody glass,

you can’t hold back the weather.

Too bloody right you can’t. But us ordinary punters saw what was coming so we have a right to expect the same from Mervyn bloody Thing and his smooth faced cronies.,

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Lib Dems Die – not with a bang but with a politically correct gesture

So what was the “issoo” that got the Lib Dems excited yesterday.

(Let’s play the Hong Kong Fooey game here, thouse of you who were or had kids in the early 1980s.)

Was it the debt crisis?
Nope…

Was it climate change?
Nope…

Was it jobs and unemployment?
Nope…

Was it inflation and rising fuel costs?
Nope?

Well was it gender free passports for sex change people?
Maaaaaaybe ……

Yes, in what will surely become the benchmark case of political death by politically correct gestures the Lib Dems let the country know they are far more bovvered about the feelings of trannies who want to travel abroad without immigration officials yelling “Heyyyyy everybody, thees one use-ed to have a deeek,” than about any of the very real crises we face.

Boggart Blog advises the Lib Dems to wrap up their operation now as they are out of touch with reality. As for trannies who want to tavel abroad, forget it, especially if you are the lorry driver in a frock type who has no idea how to apply make up, walk in high heels or even put a wig on straight. You are not going to fool anyone.

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Pea in man’s lung shows how to beat the recession by growing food inside your body

With food price inflation worrying many households in these austere time we were drawn to a story that broke yesterday about a man who grew a pea plant in his lung. This could offer hope to families on a tight budget who are trying to cope with rising prices.

Now we have heard stories of seeds sprouting inside people’s bodies before and always dismissed them as urban myths. And who as a child was not told by their mother, “There’s enough muck behind your ears to grow potatoes.”

Well potatoes are not ideal for lungs, they need lots of light and a good depth of soil to flourish. Perhaps planting potatoes in the digestive tract, equally warm and moist, with light entering through the mouth and lots of good rich compost at the lower levels might give better results. Peas and beans should be planted between the toes so they can wrap their tendrils around leg hair as they start to climb.

Another candidate for body cavity cultivation is rhubarb. The forced variety which produces tender pink stalks does best in warm, moist, dark conditions. That a suitable orifice exists on the female body could give a whole new meaning to the phrase “rhubarb triangle.”

People wanting to get really serious about intra – corporeal horticulture and raise a cash crop to supplement the family income should look no further than Cannabis. Think about it, the plant grows almost anywhere in any conditions, it can be harvested several times a year and any Afghan black you get hold of these days is likely to come into the country up somebody’s arse.

Cut out the middle man, reduce the air miles, help the planet and get yourself a decent smoke. All you need to do is swallow some seeds and a UV torch.

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More humour every day at Boggart Blog

Catch 22 Revisited: Food and fuel price inflation a political hot potato

As the blip turns into recession and hurtles onward to depression all sorts of experts are predicting all sorts of consequences, job losses, home repossessions, bankruptcies and an increase in mental health problems. And of course the reappearance of Catch – 22

Joseph Heller’s Catch – 22 was one of my favourite books ever in fact I am rereading it at the moment. The title, Catch – 22 represents the ultimate betrayal of frail humanity by the cold indifference of fate, it is whatever keeps us trapped within lousy situations. There are many variations then, depending on one’s circumstances. In the book theCatch-22 that traps World War 2 bomber crews lies in the fact that the only way to get out of flying more bombing missions over enemy territory is to ask to be taken off combat duty because one is crazy. However applying to be taken off combat missions proves one is not crazy and so not eligible to be taken off combat duty.

Catch – 22 crops up in all walks of life.

One of its latest manifestations cropped up on television yesterday. A penny-pinching expert was talking about how hard hit poorer people will be by the inflation that will inevitably follow the financial crisis. Many people will find themselves having to choose between buying food and heating their homes as they don’t have enough money to for both. He recommended abandoning expensive convenience foods and getting into wholesome, old fashioned home cooking. This part of the item continued with a very unscientific survey of cooking ability; a reporter in a busy street stopping people at random, sticking a mic. in their face and asking about their cooking skills. It seems an alarming number of people under 35 cannot cook a baked potato.

I though the whole piece was heartless, insensitive and not politically correct. The producers had forgotten Catch – 22. If you buy potatoes you will certainly be unable to afford to heat the oven for baking them but if you save your money for gas or electricity bills you will have no potatoes to bake.

Life’s a bitch as they say.

More humour every day from Boggart Blog

No web tour today, just a couple of links:
Recession Depression

Recession economics explained

Dear Darling

Mervyn KIng, the Governor of the Bank of England has had to write a letter to Alistair Darling, The Chancellor of the Exchequer to explain why inflation has risen above 2% this month.
Bpggartblog was able to see a copy of the first draft.

Dear Darling,

I am writing to inform you that inflation has risen above the 2% level that you require me to keep within.

This unfortunate rise is due in part to the dramatic increase in the cost of oil and other fuel.
There has also been a similar increase in the cost of many basic foodstuffs, perhaps you hadn’t noticed that butter has gone up by 30% in the last few months, and the cost of a loaf of bread has practically doubled over the last 9 months.
Add to that your latest excise duties on alcohol and tobacco and you can see that things are starting to mount up.
Oh, and we probably have stretched the credulity of the nation’s shoppers to breaking point by the things we have been including in a typical shopping basket to keep the inflation index down, after all, there are only so many white goods, mobile phones, items of furniture and clothing that a household will believe it might be necessary to buy on a weekly basis.

I hope this clarifies the situation for you, but if you are still struggling, after all you are only in charge of the nation’s finances, please don’t hesitate to get in touch and I will try to explain in words of one syllable or less.

Yours truly

Merv

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