Germany the Vampire Squid of Europe

Le texte est assez dur contre l'Allemagne, il possède de bons arguments, par contre, il faut toujours nuancer, l'Allemagne est un pays qui a été gouverné avec plus de rigueur et s'est préparée pour la mondialisation.

Par contre, si on regarde l’ensemble des pays industriels, très peu de pays se sont préparés pour inclure 2 milliards de nouveaux travailleurs dans le marché mondial.

Malheureusement, aucune stratégie n'a été élaborée pour maintenir un équilibre entre les coûts indirects associés de la démocratie et à l'écologie, ce fut une erreur magistrale, mais motiver par les oligarques.

En contrepartie, il y a eu des excès de l’État-Providence, l’exemple de la France avec 36 ans de déficits budgétaires en est un.

Par contre, si on arrête de regarder le passé, mais plutôt l’avenir, il faut trouver des solutions qui sont gagnantes pour tout le monde.

Le statu quo ne favorise que l'Allemagne (euro), car elle est la seule, d'être capable de faire face avec la mondialisation, en voulant exclure la possibilité de certains pays à sortir de l'Euro pour gagner en compétitivité, elle maintient cette puissance économique aux dépens des autres, cet article doit être lu dans cette perspective.

Sa conclusion est juste, mais ne correspond aux attentes des oligarques qui veulent maintenir le statu quo.

Extrait de: Germany the Vampire Squid of Europe, RobertBrusca , Zero Hedge, 03/31/2012

Herr VAMPIRE SQUID revisited and affirmed-

Germany is in it for Germany, not for united Europe. When you look at Europe and see that Germay is a success and no one else is, there is a reason for that.

Germany, after 'trapping' many countries in the e-Zone ignored their situation while Germany continues to post increasingly lower-than-required rates of inflation as many in EMU have run higher rates. As a result of this, there is a huge competitiveness conundrum in the Zone. It seems to have been engineered by Germany-and they are great engineers.

See Germany the Vampire Squid of Europe for a previous discussion of this topic. 

How are we to view Germany's actions?

Now I do not 'blame' Germany alone but as you know in our financial system the low inflation Balance-of-payments-surplus countries rule. The others are forced to adjust.

·         Germany has persisted in growing slowly, running a high rate of unemployment while others wanted to grow faster.

·         Germany helped them to do that by lending to them.

·         Germany was not mindful of the consequences of their excesses but there were consequences as they all were/are in the Zone together.

·         The Zone was not a Bento box divided into various walled-off compartments; it was like bowl of soup and poison one place circulates to another place.

As the 'adult,' or fiscal conservative, Germany did nothing constructive. It held back and watched until the others were in trouble then it dropped the hammer. Am I supposed to view Germany kindly for this sort of behavior? Did Germany really 'behave' any better or did it simply spring its trap?

C'est exactement le même comportement avec la Chine-États-Unis, en maintenant une monnaie sous-évaluée et en achetant l'endettement des Américains, ils ont gagné du temps pour prendre le contrôle du système manufacturier américain, en le délocalisant.

Même comportement pour l'Allemagne, juste une méthode différente, le temps jouait en leur faveur, beaucoup de pays ont joui d'une prospérité en intégrant l’euro grâce au crédit facile de l'euro, quand le mirage s'est dissipé, ils se sont retrouvés avec des pays qui n'étaient plus compétitifs par rapport à l'Allemagne et encore moins face à la mondialisation.

Why did it neglect the growing imbalances in the Zone? Not just the fiscal ones that might have been hidden, but the inflation differences that were reported month after month after month. I have been haranguing about EMU inflation differences in the zone for years.

·         Did Germany smirk and know that it was gaining competitiveness?

·         Did it not realize this disparity would benefit its exporters but come back to haunt it politically and financially?

Now that it has... does Germany disavow itself of any responsibility?

En fait, si on donne une corde pour se pendre et il le fait, qui est responsable ?

What allows the US to to maintain a union that has areas of vastly different real income, property values, etc, is its fiscal transfer system. Germany instead of dealing with today's issues, and assisting with development (instead of just bail-out bucks) wants to roll the clock back and set up what I have called a Bento-box view of Europe in which GERMANS will be made safe as each member of EMU will have its own mandated balanced budget and will be put in a Germanic-like straight jacket of fiscal responsibility. Hey that sounds like fun!

The Euro zone is NOT the German Zone.

It was not formed and does not exist for the benefits of Germans.

But as Germany is in a position of power it is now trying to bend every EMU nation to its way of doing things. This widespread use of austerity is foolishness. You may denigrate 'Keynesianism' a term that is such a cartoon and straw-man that it has no meaning, but austerity in the midst of recession is tomfoolery!

Germany waited until other EMU members got in trouble then, as I said, sprung THE TRAP. While the Germans think they have been virtuous they are among the TWO COUNTRIES that are the farthest out of equilibrium with respect to the Euro-average.

Look at the EU Commission indices and everyone else is weak and only Germany still has strong readings.

Exacte, ils ont eu de la rigueur et les autres ont agis comme cancre, mais on fait quoi, pour l’avenir ?

I can understand wanting to glorify Germany for this success.

But if we view Europe as a team, then Germany is not a team player.

 It is a high scorer on a team that is losing all its games! Germany has created a game of 'economy' and set the rules of EMU to benefit itself and to impoverish everyone else. 

I know this is not a popular way to look at it. We should glorify the best performing economy but why is it best performing?

Because it has the fiscal policy and national work ethic and social policy that works with the monetary policy that is being run.

Suppose the US were to play Germany in 'Football.' Suppose the US sent NFL guys in their pads and the Germans sent their 'soccer' team. Now if they played soccer instead of NFL football and the Germans wiped us out would that really make them 'the best?" Suppose we played NFL football instead?

What I am trying to do is to suggest that Germany wins at this game because it is a German game.

Germany did not have to change anything to join EMU. Everyone else SHOULD HAVE been made to change a lot but they did not. Yet the game continued under 'German rules' NO WONDER THEY DO BEST... and there has been no one out there 'blowing the whistle' on those counties that have been building excesses; they have been left alone until WHAM! Crisis time.

The Germans have not swerved one iota to help their neighbors nor has this idea of what macro policy should be been broached. The 'Mass-Trick' was supposed to be a constraint on that policy that was never agreed to but the Germans and French broke the rule first and ruined it. Macro policy cannot be every man for himself with a fixed currency.

So here is a restatement of the Zone and a new accounting of who is most out of whack:

·         Currently Germany is the low inflation country in the Zone since it was formed.

·         It has done this by averaging inflation of 1.7% per year while the GDP-weighted EMU average was 2.12% per year.

·         Only FOUR EMU nations among the first 12-members average inflation at the EMU average or less (Germany, France, Finland, & Austria).

They are the strong countries and they are the outliers -too. Of course Germany and friends are closer to the EMU average because Germany is such a large country and it carries a large weight in making up the EMU average. If we look at the simple unweighted average for inflation for the EMU first-12 members, average inflation among these countries goes up to 2.35%. Viewed that way the most normal country since EMU was formed is Italy in terms of inflation followed by Ireland. Next most normal is Belgium. Germany ranks 11th out of 12, and guess what? Greece ranks 12th! Germany and Greece rank right next to each other as outliers- on different ends of the spectrum, of course. .

Isn't that amazing?

If policy were geared for the average EMU country the Zone would be quite different.

But it is not; it is geared for Germany making everyone else
much worse off relative to Germany.

Instead of having a zone with most members tightly clustered around the average with Germany and Greece as outliers we have a policy that is being run for one extreme of the Zone - Germany!

Typically the Germans think everyone else is wrong.

...and before you side with Germans let me note here that the US has had a good inflation performance over this period averaging a CPI of 2.5% (PCE even lower) . So before you go, "Ugh! Italy's the the average - are you crazy!!!" remember that US inflation has been relatively well contained during this period and Italy has done BETTER than us. But Italy is stuck in Zone with Germany and policy is being run for German inflation at 1.7% not for Italian inflation.

Yes, the Germans are extremely successful in EMU especially compared to everyone else.

They know how to work, how to engineer - there is no doubt about that.

But they do not know how to share; they know how to dominate militarily, economically etc. Now they want to dominate EMU by by setting macro policy and social policy as well as having a German monetary policy.

If Germany is going to be in a single economic zone with everyone else, it must fit as well as they must fit. Germany and France were the first to break the Mass-Trick rules and once that was gone they could not expect discipline from others.

Il a raison, tout à fait difficile faire la morale aux autres, quand eux-mêmes n'ont même pas suivi leurs propres règles.

Germany wants every other nation to sacrifice a generation's worth of growth to get their competitiveness back in line to and to defend Herr Euro. Why should any of those countries do that to perpetuate a game where the Germans win?

De plus, ce n’est même pas évident qu’après une génération on va être capable d’améliorer sa compétitivité, pensez-vous le s autres vont attendre et ne rien faire ?

The two important questions to ask are:

(1)   how did this happen so we (Europe) can stop it from continuing and (2)

(2)   what do we (Europe) do about the huge competitiveness gaps that each EMU member -EACH MEMBER- took part in letting develop? NOT What does GERMANY want to do...

Can EMU be saved?

·         Should everyone devalue and re-form a new currency unit?

·         Should the new unit be renamed?

·         What are the new rules?

·         Who makes compromise in the next system?

Say it UP FRONT.

Certainly you can't expect whole countries to sacrifice a generation of growth to protect a currency!

That puts economics backwards.

Currencies are there to serve economic efficiency, to replace barter and to augment growth not to enslave a nation..

...unless you are German of course.

In that case it works for you and you can enslave everyone else.


Germany, the VAMPIRE SQUID of Europe.

Ce texte confirme les propos de l’auteur.

Comment en sommes-nous arrivés là ? 

Il y a onze ans, pas le biais d’un simple traité international, des pays du sud de l’Europe ont obtenu une évaluation de leur crédit inédite pour eux et une crédibilité internationale qu'ils n'avaient jamais eus. Autrefois, les taux d’intérêt de ces pays tournaient autour de 15-18%. La simple anticipation de leur entrée de la zone euro a fait chuter ces taux au niveau allemand, divisant par trois les taux de crédit. Ce faisant, la prime de risque sur les marchés financiers a disparu. 

Les économistes qui ont reçu le Prix Nobel la semaine dernière ont parlé de comportement rationnel à court terme. Si on importe de la monnaie et que l’on emprunte, on produit de l’inflation et un déficit profond de la balance des comptes courants avec accumulation de dette étrangère. C’était prévu et c’est exactement ce qui s’est passé. Les politiques n'ont pas regardé plus loin que les échéances électorales suivantes et ont ignoré les conséquences économiques.

La crise grecque a réveillé les marchés. Un euro grec peut-il valoir un euro allemand ? La Grèce a accumulé inflation, dette extérieure et augmentation de 70% du coût unitaire salarial (contre 1% en Allemagne) : ils ont perdu toute compétitivité.

Tout manuel d’économie dira qu’il faut s’en sortir
par une dévaluation et rien d’autre.

C’est pour cela que le peuple grec est en colère, on dit paie tes dettes, mais on détruit ton économie entre temps.

Alors, les Grecs, disent va te faire foutre, et ils ont tout à fait raison.

Le choix, pour un Etat est entre la dévaluation des salaires ou celle de la monnaie. 

Dans une célèbre métaphore comparant l’ajustement de l’heure d’été aux individus plutôt que l’inverse, le Prix Nobel Milton Friedman jugeait qu’

« il est plus facile de modifier un taux de change extérieur que des millions de prix »

Si un pays perd sa capacité de dévaluer, il ne lui reste que la possibilité de réduire le coût unitaire salariale ce qui signifie non seulement la déflation mais une politique salariale catastrophique pour ce pays et pour ses créanciers aussi. Il n’y a alors plus d'investissement et donc plus de croissance économique possible. On constate aujourd’hui un effondrement de la prospérité économique grecque, -5% cette année, plus encore l’année prochaine. 

C’est la politique la plus destructrice que nous ayons eu depuis les  années 30. Ce soit disant soutien est en réalité destructeur. 

Avant l’arrivée d’Hitler au pouvoir en Allemagne, le ministre de l’économie avait accepté une politique déflationniste car l’Allemagne ne pouvait payer ses dettes de guerre ; entre l’automne 1931 et l’été 1933 le chômage a alors frappé 27% de la population active… ; Ce sont des souvenirs terribles pour l’Allemagne et pour le monde entier... 

Ce que l’on inflige à la Grèce est la même chose et les mêmes problèmes vont se poser aux pays du sud de l’Europe : ils vont se retrouver dans la même situation que les pays d’Afrique du nord - la Lybie, l’Egypte, la Syrie – avec les mêmes soulèvements populaires.

La différence est qu’en Europe, nous avons fabriqué le problème nous-mêmes…(1)