Growth grinds to a halt The German economy grew by a meagre 0.1 percent in the second quarter of the year, while expansion in the first quarter was slower than originally reported, according to official data published on Tuesday. Germany fights growing support for eurobonds (15 Aug 11) Schäuble calls for solidarity to fight crisis (14 Aug 11) Greens to challenge government over Libyan mission (13 Aug 11) Analysts polled by Dow Jones Newswires had forecast 0.4 percent growth for the second quarter in the eurozone's top economy as the group grapples with a crippling debt crisis. "The dynamism in the German economy has cooled significantly since the robust start to the year," the federal statistics office (Destatis) said in a statement. It revised the first-quarter growth figure down to 1.3 percent from the 1.5 percent originally reported. Destatis said the 0.1 percent growth in the second quarter compared to the first quarter came based on only anaemic expansion in exports, the backbone of the German economy. Imports rose in the second quarter more than exports, undermining the growth figures, as consumer spending and investment in construction also slipped. The figures were stronger in a year-on-year comparison, with gross domestic product rising 2.8 percent in the second quarter. In late May, Merkel had said it was likely that gross domestic product would rise more than three percent this year, in line with the forecasts of most economists and key institutions. The Bundesbank central bank expects 3.1 percent expansion in Europe's biggest economy this year while the International Monetary Fund has forecast 3.2 percent growth. The government's official forecast, reported in April, remains at 2.6 percent but economic data since then had made that prediction seem timid. Chancellor Angela Merkel, who is meeting French President Nicolas Sarkozy later on Tuesday in Paris for talks on the eurozone crisis, said last month she expected German growth to reach a similar level this year to the rate in 2010, when it hit 3.6 percent. On the eve of the talks both sides talked down the chances of a breakthrough, and the French and Spanish markets dipped when a German spokesman flatly ruled out talk of issuing a joint eurozone bond. Last week, European stock markets saw their worst losses since 2008 on rumours that France might lose its Triple A credit rating and as the European Central Bank had to intervene to buy Italian and Spanish government bonds. Sarkozy has been pushing for a more centralised system of controls across the eurozone, better able in Paris' eyes to protect against future meltdowns. But Merkel - and German voters - oppose any bid to create what they dub a "transfer union" in which Germany's powerful export-led economy effectively underwrites its underperforming eurozone partners. Such a system would make it easier for struggling members like Greece or Portugal to finance their massive public deficits but would also transfer some of the cost of servicing these debts to German taxpayers. This would be a complete non-starter for Berlin without a quid pro quo of new rules to enforce tougher fiscal discipline throughout the bloc. On the eve of the talks, a German spokesman said the idea of eurobonds to pool eurozone public debt would not even be on the agenda in Paris. Merkel and Sarkozy are to meet in Paris in the afternoon, then hold a press conference before sharing a working dinner. Afterwards, they will make recommendations to European Union President Herman Van Rompuy. Sarkozy will meet his cabinet on Wednesday and on August 24 he is due to unveil austerity measures designed to bring France's budget deficit down to less than three percent of gross domestic product, the EU limit, by 2013. http://www.thelocal.de/money/20110816-36979.html Germany's economy had better grow! They are the Atlas that is supposed to hold the EU on their backs. _
The Germans have a massive manufacturing base so this is quite a surprise! Poor Germany, richest nation in Europe.....is been dragged down bailing out the weak economies of Europe, like the Greeks who will just waste away all the money thats been given to them. Thank god.....the UK never joined the Euro......or we would be truly up a gum tree!
The Germans are in an awful position and they probably have no choice now but to keep on digging an even deeper hole for themselves. They are having to take the burden of all the failed socialist European Euro-based countries on their backs because they're the only major Euro-based player that isn't on the brink of bankruptcy. But the Germans I know are NOT stupid, and they will not put up with much more of this crap, no matter what. Merkel will find herself thrown out of power if she gets sucked too deeply in this nonsense of saving everybody else while watching her own country go to hell.... Look at Europe in 2011 and behold the success of Socialism! Twenty years ago we witnessed the death of Communism everywhere but North Korea and Cuba. Today we witness the beginning of the end for Socialism, too!
Yes the Brits are having a spending economy for years, cough. Germany's true problem are demographics, they can handle a lot. Innovation and industry will keep them going.
No they don't. Germany is a post-industrial service based economy, much like the U.S. Manufacturing only makes up about 28% of their GDP...compared to 22% for the U.S and 47% for China.
Not really. Try again. If you think you can have a strong economy and lose 20 million people by insane aging be my guest.
Communism as Marx described it hasn't ever existed because it somewhat resembles anarchy. Socialism comes in a lot of forms though. Most socialism that has existed has been of a capitalistic strain.
Yes.....'ignoranceisbliss'.....i should of used the word 'large' rather than 'massive' when describing the German manufacturing sector, its certainly a lot stronger than other European nations......and its this sector which should help pull the Germans through the economic turmoil..........otherwise people wont have those nice BMW's to drive around in.
What is this crap about socialism?! Where is the shining example of capitalism? Let's not pretend this is just the fall of the Soviet Union and everyone is suddenly going to get a 10-digit pay raise. Everyone in the world is hurting right now it's a global recession on the verge of a second.
Facts are important. I spend so much time on these forums correcting people on popular misconceptions.
How much of this could be due to the renewable energy Germany has switched to? Their energy costs are several times the US. https://thehill.com/opinion/energy-...how-shifting-to-renewable-energy-can-backfire
This The only way that "proper" socialism can actually be enacted is if we live in some Uotpia where everyone is nice to each other and doesn't compete. That won't happen unless we figure out some UFT Star Trek type stuff
a large manufacturing base will come in handy during recovery Something anti manufacturing libs in America fail to appreciate
