5 Antworten auf „Germany in the Dock
The Euro distorts the current account balances

  1. I think we can already see the coming “solution” for the so-called “imbalances”. Just look at the Ukraine where a box champions tries to push out a, and that has to be said, “undemocratic” power house ( however you want to judge about that ). Once the king(s) have been toppled there will be a new and great “freedom” surrounding all Ukranians. The freedom is unfortunatly just bought with debt which will pave the way for a, for the time being, “economic boom” for the European Union. But as time progresses all the cheap talk will, just like in the mediterranean countries, go down the tube with higher “imbalances” and of course “stronger” ( perceived ) core countries. But thats all an illusion just like what has been said in this article – the Euro(zone) is a big fantasy land.

  2. Conclusion

    Ladies and gentlemen, let me conclude.

    The crisis has shown that a monetary union is not a shield against balance of payments problems in the face of persistent imbalances.

    Adjustment pressure in a currency area is cushioned by the single monetary policy, which avoids abrupt adjustment but also necessitates additional rules.

    Regarding the euro-area imbalances, significant progress has been made. But further reforms are needed to facilitate the shift from the non-tradable to the tradable sector and, hence, to strengthen sustainable growth.

    Stimulating German demand by means of an excessive wage increase or a credit-financed increase in public spending cannot be a substitute for that. And given its demographics and degree of economic development, Germany’s current account is likely to have a positive sign in the future as well.

    But by removing rigidities in the services sector, Germany might not only strengthen its growth potential, but could do so in a way that is likely to have a moderating impact on the current account as well.

    Reforms like these show that adjusting imbalances in the euro area does not need to be a zero-sum game. If done properly, it will serve the interests of everyone, and this is why, despite the struggle and setbacks, it is a path worth pursuing.

    I now look forward to our discussion!

    in: Jens Weidmann, External imbalances in the euro area. Speech at the International Business Cycle Conference Kiel Institute for the World Economy

  3. Da fehlt dann nur noch ein Teilzitat von Mutti:

    ” I find myself caught between the devil and the deep blue sea. ”

    Dem ist nichts mehr hinzuzufügen.

  4. So now as everything finally unfolds, I kind of have to wonder why it really happens the way it does. I mean, does nobody see that all of this stuff is a setup to steer legally “indepent” countries to the wall ? What kind of economic policy is this ? How can anybody develop when you have to fear that somebody is pulling the trigger behind you ? It is totally unbelievable; only Mutti doesnt seem to know … .

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