Juat found this on a guardian business blog.

v interesting.....

"Germany has a very nice image of itself which is very comfortable. Britain has one too - that we like to play fair at cricket and everyone else cheats. Both images are bollocks.

Germany likes to think that it makes good things and people elsewhere want to buy them. If other people get into debt because they can't resist German goodies, that is not Germany's problem. Germany is getting on quietly and peacefully* and not hurting anyone.

Sadly, this completely ignores the global trade imbalances at work in the last 20 years. Where has all this credit come from that teh PIIGS have been splashing out with. Er...German banks. And the German banks were getting their money from German trade surpluses.

What has happened, as with China, is that the surplus capital needs to be reinvested somewhere, and with German manufacturing tiptop but wages low (no miminum wage) this money has been thrown into Southern Europe to try and get more people to buy more German goods, or at least make the surplus capital earn some interest.

So Germany may like to see itself as the good boy of European economics, when all around everyone is badly managing their economies, but the whole German model relies on the PIIGS maintaining huge debts in favour of German finance and manufacturing.

But the chances of Germany recognising this are very small.

----------------------

*which is another point. Germany exports huge numbers of arms. They make assault tanks in Bavaria and nuclear submarines in Kiel. Vorsprung durch Technik."

Posted By: shoddy on May 14th 2012 at 21:36:00

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