However, before this happens, the German economy will first contract over 4.5% this year, with minimal growth "in sight" for 2010. Unemployment is expected to keep increasing throughout 2010. Private consumption will improve, though how they reason this with unemployment increasing isn't revealed.
"The economic downturn in Germany has come to an end," says one forecast. Yeah, right. Be sure and tell that to all those poor folks who just got fired.
More "good" news is that business bankruptcies are exploding "in the air", and consumer insolvencies are up 7% from a year ago. Company revenues are down 17% from July 2008. Mechanical engineering - "one of the most important industries in Germany" - had sales plummet 30.8% in July from the "previous January".
How do they expect all this to be positive news for Germany? After all, even the IFW and the bankers are "forecasting" the German economy to be "pulled" down by domestic factors.
Simple. The Kiel Institute expects demand from abroad to "animate". Which in translation means they expect US consumers to come to the rescue and start spending like drunken sailors again. Tell me, all you US consumers, do you really feel like going on another binge?
For better or worse, the world economy still needs Uncle Sam. If anyone thinks China and the rest of Asia is going to save them, they've probably been spending too much time in some Buddhist ashram. China, Asia, and the rest of the world are just not the big spenders the US used to be. They've got their own problems, partly caused by themselves and partly incurred by the American financial collapse.
Germans. There's not going to be another 1948 Berlin airlift.
"You cannot feed the hungry on statistics." - Heinrich Heine
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