EUROBLOWN: Germany will wind up owning Europe, while paying just a third of the asking price.

Now here’s a funny thing, missus. Go to the EFSF ‘explanation’ thing as issued by the European Bunion, and scroll down to the table on who the biggest contributors are to it.

Unsurprisingly, Germany is first and France second. But look who’s running close behind them: Italy and Spain. Now let’s be real about this, does anyone see Italy and Spain as in a position to bail out Greece, Portugal and Ireland? No, me neither.

So while Berlin continues to moan neurotically on about how much the rest of Europe is asking of it, think on these facts: first, from being itself an exporting basket case in 2003-4, Germany has reaped the benefit of an artificially cheap currency since then; and second, while Berlin is responsible for more eurozone debt repayment than most, it is far from being solely responsible. These are the percentages:

Germany 29%

France 22%

Italy 19%

Spain 13%

Now then, my little Berliners, you can’t have it every which way. That is to say, you can’t argue that everything is down to you, but you also want everyone in the dock with you….and with several reponsibility, but not individual responsibility as per the Berlin FinMin proposal leaked last week with a degree of deliberate spin intention.

You might want to argue it that way, but the all-knowing Slog will find you out.

The evidenced truth is that Berlin, under the EFSF conversion into ‘something more permanent’, will be responsible for under a third of all ezone debts. Compare that, my friends, to what their relative gain has been during a decade of export bonanza uderwritten by an articially cheap euromark. And when you hear Onkel Wolfie und Tante Geli droning on about how they have the thankless task of carrying the can, just bear in mind what life is going to be like in the Fiskal Redemption Correction Clinic to which the other sixteen are now committed…including poor blackmailed/deluded Ireland, helplessly broke Portugal, and necrophilically raped Greece.

The politics will be marched onward by Merkel, while the disabled Schäuble will dictate the finances. Yes, of course there is a degree of speculation involved for the Germans.  But they are speculating to accumulate…and the accumulation of power now almost within their grasp is awesome.

One is left wondering what the Foreign Office mandarin wonks are up to…if anything.

Related: Berlin relents…ooh, no, sorry, it hasn’t

61 thoughts on “EUROBLOWN: Germany will wind up owning Europe, while paying just a third of the asking price.

  1. ” Germany will wind up owning Europe, while paying just a third of the asking price.”… that was always the plan.


  2. Deutschland, Deutschland Über alles!!

    Germanification of Europe may not a bad thing from an industrial perspective, but with Geli and the other clowns in charge, lord help us!!


  3. No I have always thought this was a plan to stall the fall, isolate their exposure to Greek debts, shore up their own banks, and subjugate smaller economy’s into ongoing fiscal indebtedness… I have never imagined that Germany doesn’t know exactly what they are doing… I just did not agree that it was the right thing to do. If you are going to take the time to judge me, get to know me :)


  4. @John.’Germany will wind up owning Europe..’.I think not.As I have said before,their Europe export model was and is based on vendor finance.Low Euro interest rates enabled the PIIGs to buy plenty of Mercs and so on,for worthless IOUs.Foreclosure on the Acropolis and the Prado?If and when the Euro project falls apart,the loser is Germany,left holding the equivalent of debt in an Icelandic bank.


  5. JW’s comments – despite their perhaps involuntarily anti-German tone – I can take. Because they are sometimes informed and not mere kraut-bashing. Wish I could say the same about some sloggers. I try to avoid judging the slog by its readers – though it is sometimes hard.
    Geli the overcautious has doubtless got it wrong in not recognising the extent and impact of the debt problem of euro-nachbaren – but she is driven by her advisers whose advice (until recently) has been not very different from that of the uk treasury and other finance ministries. it simply undermines critics’ credibility to describe them as power-hungry clowns.
    Words and time fail me …..


  6. I’m not “kraut-bashing” as you so delicately put it, I admire the German people and have a lot of respect for their work ethic and engineering expertise, but as with ourselves, our leaders and their advisers leave a lot to be desired.


  7. I agree. Germany does generally make excellent quality stuff-which people want to buy. However I tend to think build quality has suffered of late-my Golf lets in water when it rains for heavens sake. Never happened with my ancient BMW……


  8. I’m not sure even philosophy can address what to deal with first, the chicken or the head {groan}

    But as far as I’m aware souls are supposedly headless, although not faceless, if the depictions by the more artistic amongst us are anything to go by. Perhaps its a moot question as any part of the body can be missing and not affect the soul, it being more of a spiritual essence rather than a physical presence.

    But what do I know, heck I’m still under the impression we’re all in this together……….!


  9. Economic and Monetary Union is just ‘a German racket designed to take over the whole of Europe’. The Late Lord (Nicholas) Ridley (1929-1993).


  10. Worry not, in fact sleep well. Our David is going to Berlin tomorrow to give that Frau Merkel a piece of his mind. I suspect he will come back waving a piece of paper mumbling something about peace in our time


  11. @Dave… sorry, having the most common name in every language on earth… with the distinction of being both an employer of prostitutes, and the toilet leads one to confusion… :)


  12. Chamberlain was much under-rated and is probably due for a revision of his reputation.
    Cameron was much over-rated (not by me, I might add-never could stand him!) and is long overdue for revocation of his leadership.


  13. In my case… I blame the anti-Greek tone I have heard emanating from Germany for the last 3 and a half years…


  14. ” Our David is going to Berlin tomorrow to give that Frau Merkel a piece of his mind.” Can he spare it!


  15. Some thoughts:
    a) None of the big 4 (Germany, France, Italy, Spain) has ratified the Fiscal Compact so far.
    b) “The ESM’s effective lending capacity will be €500 billion”. Is that enough to assist Spain and/or Italy if the situation explodes?

    As for the raped Greece (which joined the party with her ass totally exposed), latest rumor has it that Germany has allocated her the role of Ifigenia, before the rest of EZ embarks to the ships to conquer Troy.


  16. The mud is being slung in all directions. Smoke and mirrors/divide and rule, is alive and thriving.


  17. Pingback: Germany will wind up owning Europe, while paying just a third of the asking price / Η Γερμανία θα καταλήξει να κατέχει στην Ευρώπη, στο ένα τρίτο του της τιμής. « eleutheriellada

  18. If there is a plan – and I doubt there is – it is certainly not a German plan, or a French plan, or an Italian one (or, or, or …), it is a plan by those who really profit, who are in the business of profit, which makes it the “money people,” be they banks, funds, gazillionaires, Soros et al.

    As said, I rather don’t think there is a plan, not by any definition of the word anyway. What there most certainly is indeed is “taking-advantage-of-whatever-advantage-there-is” – and that advantage is taken by those who can (see above).

    Germany has always been an export nation, long before the Euro came into being. Germany didn’t want the Euro. It was a French “plan” (desire?). Maybe it was indeed, as it is said, because they feared that Germany would become too powerful after reunification. Maybe the French’s plan was to curtail Germany by taking the DM away from them. If so, it didn’t work out that way, did it now?

    What I do know is that, since 2000, income/purchasing power of more than 70% of Germans either stagnated or went down, by as much as -10,3% for the 10% of population with the least income/year. (It went up by 15,5% for the 10% residing on the other end of the income spectrum; see above re.: who profited.)

    Personally, I find those “official” numbers difficult to believe. Anything that one would call “discretionary spending” doubled or tripled in costs over the last 10 years; same is true for energy costs. Maybe those who calculated those numbers included VCRs and PCs to a higher ratio in their lil’ basket? Those actually did got cheaper. Great. How many does one buy of those?

    The cuts in wages (Agenda 2010; Hartz IV) weren’t done because of competition with Greece or Portugal or Spain (competition in respect of what industry?), but mainly because of China. In fact, more importantly, those reforms were aimed at demographic problems within Germany: the system in place here is build on babies to grow up, work, pay into the system, babies that weren’t made for the last 40 odd years or so.

    God knows, I find Angela Merkel difficult to even listen too. And don’t mention Herr Schäuble. He makes me physically ill. But for all I know (about their politics/history/whatnot), I am most certain they both cry bitter tears every night because the last thing they want is being in the position they are in.

    Honestly, no-one in Germany (probably including Deutsche Bank) wants to take over Europe. But here we are: damned if you do; damned if you don’t. Ironically, Germany doesn’t even have *that much* money, no matter whether it is a third or a quarter. If the so-called PIIGS go, so will €600B+ – a quarter of German GDP. If the Euro is to be saved, the numbers will eventually be even higher.

    Worst of all however … especially the latter outcome will lead to even more hatred amongst the people of Europe, more finger-pointing (“The Greeks!” “The French!” “Nazis!” etc.). Which, incidentally, was the main reason I was against the Euro in the first place. It was always bound to become unhinged. And then what? Someone would have to pay the bill. And that someone would demand (being a democracy after all) some sort of control over budgets. Which those controlled wouldn’t like too much.

    Now, I don’t know whether you can that clear-as-daylight roadmap to disaster a “plan”, but that’s all the plan I can see here: how to get between rock and hard place within a decade.

    Long comment. Forgive. ;-)


  19. “Give me control of a nation’s money and I care not who makes the laws.”
    – Mayer Amschel Rothschild


  20. I still don’t see how it can work, otherwise we wouldn’t be in this situation.
    Unless there’s huge oil reserves or untapped mineral wealth under Spain and Greece, it still seems that Germany is buying a time-share.
    The underlying problems that both Greece and Spain have, is their main trading partner is Germany with the balance of payments soundly in Germany’s favour. Which leads us back to square one.

    How do they pay for the German imports without lots of cheap low interest loans and without blowing it all on a housing boom, or without scheming politicians subverting things by building a client state? Which most countries seem to do at the moment, when confronted with access to masses of cheap credit. (UK included.)


  21. Maybe that’s the dilemma here … unlike in the UK, the US, or Japan, no-one has control over the money in EZ-Europe, not really anyway.

    The ECB can’t be controlled, as it itself has no real control, neither has any of the Euro states for that matter. It’s all action (in-action) by committee (well, laws, but not really anymore). And the committee is far from homogenous.

    Amschel wouldn’t like this particular set-up all that much, I assume.


  22. @I am (@Ndege): “Honestly, no-one in Germany (probably including Deutsche Bank) wants to take over Europe.”

    I know what you mean but it’s the political elites and others in the shadows who decide what a country does. The peoples’ wishes are rarely considered. If Germany’s elites have a plan to take over Europe, they will manipulate policies and actions to achieve it…unless someone stops them.


  23. Let’s face it, one way or another there is going to be a crash. Whether it is a Ben Nevis or Mt Everest size one, who knows. The stretched out when is what is killing us!

    I still think Japan will pop first.


  24. Bankrupt Taxpayer meet “The German Elites” …

    The German “Elite” once went by the term “Deutschland AG”. I have worked for (with?) many of them (most German blue chip companies).

    By and large, they are as “bürgerlich”(middle-class) as you can possibly imagine. Some would call those power brokers (and, yes, they have power, in Germany) square or narrow-minded. I am one of those some.

    They have no take-over-the-World plans. They can hardly run their companies foreign affairs properly. The moment one of those (even very high up CEOs) gets “international,” hilarity ensues.

    I loves me my German brothers and sisters. They are a great lot, solid friends, good with their hands and minds when it matters (and very many Germans actually have quite a bit of love and such for people from many of those lands that make up Europe).

    But, man, are they booooooooooring by international standards, especially when they want to be “international,” and that is putting it mildly. (And by “international” Italy will suffice for many of those “Elitists”.)

    The last big “internationalistic planer” operating from these shores was Austrian. The boss of Deutsche was Swiss. Coincidence? Maybe it’s the mountains? ;-)


  25. Make a judgement on the basis of this little story, the headless chicken that lived for four years (a little like the euro seems to be doing)


  26. I know … it is cruel (but since he is one of my fellow countrymen, I think I can get away with it).

    This is Günter Öttinger. He was rather a big fish in the CDU pond in Baden Württemberg, before Angie booted him off to Brussels, where he is no Commissioner for Energy (LOL).

    He is German Elite, par excellence. Fear him not.

    The set-up to what the video is about is him saying “Every German needs to speak English …”


  27. Add in the contingents and guarantees and the German
    debt/gdp ratio is very similar to the UK’s.That’s before
    the new slush fund obligations.
    In the land of the blind the one eyed…………
    If Germany is set on this path they will be joining the PIIGS
    in Carey Street(bankruptcy court,for non Brits).


  28. What has changed? Do the Germans suddenly want full financial integration with the PIIGS? Even if they somehow did see the light and throw their weight behind a common purse, there is not enough time for the German government to vote on this financial commitment. If the Euro is to be saved it will be done by violating the laws that are in place. If this is the case why should anyone trust anything written and signed from here on out. There will be blood if this happens.


  29. @Bill I think nothing has changed, not really. Of course, I cannot know for certain. But I would suggest that what we are hearing from Germany in the English speaking press (of which some is reported/re-imported back into the German media, btw), is half-truths, at best.

    For example: Merkel is getting softer on directly financing the Spanish banks. Um. No. Not from what I read, see, hear in Germany, in the papers, on TV, from spokespeople of government officials.

    What there is, is some “suggesting” of “something” or “other”, possibly to be considered to be done “in the future.” But, in relation to Spanish banks, the government says: “it is up to Spain to ask for help. The mechanisms are the same for Spain as they are for others, under the current laws of ESM and the EFSF.”

    In fact, until about two days ago, neither Merkel nor Schäuble have said anything really about Spain/Spanish banks, which I found interesting.

    Anyway, whatever Obama or Cameron want Merkel to do (Eurobonds, shared guarantees of deposits, ladihdahblah) … is not possible with the current constitution in place. The constitutional court has ruled quite clearly, if there is more burden-sharing, if there is handing over ANY more sovereignty, the current constitution needs to be replaced by a NEW one, nor merely amended, REPLACED. Via a referendum. Which is the LAST thing any German government (or Brussels!!) ever will want to take place.

    Maybe, just maybe, what we are reading/hearing … is PR noise coming from the banks? No idea.

    Germany has neither the money, nor the legal basis for 99% of the “solutions” being reported/discussed.


  30. Reblogged this on Machholz's Blog and commented:
    Machholz in Germany…………The news over the radio is that there are over one million job vacancies in the whole of Germany and the politicians are looking at ways to get foreign workers to fill these vacancies. Most of these are low paid jobs .Remember there is no minimum wage in Germany and you can expect to earn no more than 1000 to 1200 Euros at best!
    Looking at other news I see that Angelika has told Enda to get stuffed and to pay up! There is no deal to be made on Irish bank debts. Kenny has no more clout in Berlin than the local town drunk! With the latest news coming out of Spain it seems that the real masters of the game” chicken” are about to reap rewards without surrendering any of their sovereignty .Yes the Spanish have gotten a great deal and they did not have to sign away their sovereign right to get it as Angelika has blinked first!


  31. No lie, Holmes. Glad finally someone is here thinking and not hyperventilating. There is no conspiracy and all the evidence I have seen is that of Europoliticians from just about every sorry Eurozone country reacting to events and not getting ahead of them.

    Just look at Target2 balances and it is clear that if the Euro were to go down, Germany would take massive losses. At the same time, Euroausterity isn’t very good for the German export model either.

    The problem within the Euro is that trade imbalances were not allowed to correct themselves, and pointing out ugly facts like “Greece is fudging its statistics” was the sign of a “Bad European”.

    Actually, something similar can be said about the US relationship to China, except only one side is keeping its currency artificially low in that relationship.


  32. I also worked in one of these international German companies. I thought I was the only person who noticed what I am (@Nudge) pointed out.

    I wonder why it is that Austrians and Swiss seem to be better at being “international”.


  33. And as per Armand D’Angour lecturer in classics at Oxford University , if the Greeks could get advice from the Oracle in ancient Delphi , it would be in this line ” Greece should abandon the euro if the euro has abandoned Greece” .Go figure.A bit like listening to modern economists .


  34. Dame Enda – ” A mere governor of that tiny province, hanging desperately onto the edge of my skirt. what’s it’s name again, Island, oh no, Ireland, that’s right “.


  35. @Stackmonkey: There are huge untapped resources in under the Agean sea, hence Geithners’s plan for Greece’s cauterisation never came to fruition. Germany though they were getting short changed!


  36. Most of that is wrong. Germany didn’t want the Euro. It was a French idea to curb the strength of the German mark. The German exports industry didn’t do badly at any point in the past 20 years, Germany’s unification led to a lot of debt based import though and made it look less strong on paper. Germany for the first 10 years of the euro suffered from it because the capital exports were so high and investment low. Now all Germany really wants to know is this: will the other countries reform and get competitive again so they can eventually pay back all the money they borrowed and consumed?


  37. @I am (@Ndege):
    I’m not sure. It was the German political elite under Kohl that drove the unification project forward. It was the political Murky who oversaw the replacement of the Greek elected Prime Minister with a placeman. Ditto Italy. None of these actions were planned or sanctioned by German AG CEOs as far as I know. It is Murky who’s dancing on pinheads looking for an EZ solution. If German AG called the shots, why don’t we see them banging on the doors in Berlin demanding that Murky and Baubles get their act together?

    That said, Germany clearly operates a mercantilist/corporatist model just like Britain, except yours is generally successful, ours is not. In Britain’s case it operates against the public interest because the agencies of State (unelected quangos: Ofcom, Ofgas etc) who manage the relationships at arms length to fool the public are a mixture of incompetence and political agendas.


  38. I don’t think there is a plan.The real power in the EZ, lies with the civil servants and the eurocrats. Just as in the UK they are the people who have most to lose ,so they’ll try desperately to keep the show on the road
    irrespective of what the cost will be to the rest of us.Let’s hope the *astards don’t succeed.


  39. What are the Germans going to own? Foreign Asset, Real Estate, Companies, Banks, etc?
    I can tell: They will become proud owners of other peoples (European) debts! And they are just stupid enough not to avoid that newly gained ownership.


  40. Yep, looks like Germany are making a play for it.

    “We need not just a currency union; we also need a so-called fiscal union, more common budget policies. And we need above all a political union”.

    Soon we find out the true position of our so called eurosceptics.
    They are going to have a hard time convincing everyone!


  41. An interesting read this thread – lots of good viewpoints :-)

    Personally, looking at the ‘Dogs Breakfast’ being recycled over the past year or two, I don’t think there is a ‘Grand Plan A’ nor a Plan B for that matter – it’s more of a case ‘we will deal with the problems as they happen’ – can it be any different ? I think not because No CEO would allow / permit this debacle to roll on unabated…hence the Can kicking


  42. Agree, Chamberlain was buying time to re-arm (which he instigated in earnest in 1936) and because he thought war with Japan more imminent and we (th UK) could only fight one of these enemies at a time (the US was very isolationist and would probably not have intervened between UK and Japan, probably hoped to pick up the pieces after these two had slogged it ou).


  43. Sloggers might enjoy this guy’s take on things, matters German in particular. I’d also recommend a read of Oliver Hartwich’s piece on the true origins of ‘NeoLiberalism’ (linked to in Daniel’s piece “Blaming the Germans 1st June))


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