Friday, December 12, 2008

Hmmm ...

Indie :

Steffen Kampeter, the budget spokesman for Ms Merkel's Christian Democrats, said: "Peer Steinbrück's comments have nothing whatsoever to do with internal German politics as Prime Minister Brown has suggested. In questioning the British Government's approach, Peer Steinbrück is exactly expressing the views of the German Grand Coalition.

"After years of lecturing us on how we need to share in the gains of uncontrolled financial markets, the Labour politicians can't now expect us to share in its losses. The tremendous amount of debt being offered by Britain shows a complete failure of Labour policy."

As a rule I care not what other nations' politicians think of the UK. But Germany on economics is worth listening to, if only because German companies still make things - in Germany - that people want to buy. We sold off most of our companies years ago. Some of them are still UK-based, some aren't. Some of the most successful manufacturers here - like Toyota and Nissan - are greenfield start-ups. I like their general approach to debt as well. We were like that once. I can remember the adverts in the early eighties for something new-fangled called a credit card, which apparently 'took the waiting out of wanting'. In practice it just seems to have put it off for 20 years.

Their near no-risk attitude to money is reflected in their spending habits: the Germans have minimal debt, few credit cards, no sub-prime mortgages and what could almost be described as a national phobia about the stock market. Just over 15 per cent of Germans own shares and some 500,000 of them sold what they had at the first signs of the credit crunch in August 2007.

Less than half of Germany's 80 million citizens have mortgages, and a 30 per cent deposit before buying a home is the norm. Sixty per cent of the population lives in rented accommodation and only 5 per cent use credit cards regularly. Most people pay cash or use direct-debit cards. Experts such as Fabian Christiandl of Cologne's university's economic research institute admit: "The puritanical ethic of the war generation is still very much a part of today's Germany."

Brown's fiscal stimulus and VAT cuts would be all very well if the extra spending was on UK-made goods and services. But what good will it do if it stimulates a few more 42-inch TV sales ? How much of that cash will stay here ? And what good is the collapsing pound if we don't make anything people want to buy ?A couple of the comments on the Biased-BBC blog struck me :

"if weakness in a currency were such a good thing, Zimbabwe would be going through an economic miracle"

"Exports are yet another of Brown's non-existent divisions being moved around the map in the Downing Street bunker whilst his (and our) nemesis closes in."


Martin said...


I would recommend an article of Pat Buchanan's called 'Benogn Neglect of the Dying Dollar'.

Martin said...

Or I would do if I could type.

Anonymous said...

If fiscal stimulus through unsupported borrowing worked, then why are we in this mess at all?

Rob said...

I sound quite German in my habits. No debts, no credit cards, no stock market investments. Just savings which these bastards are going to ruin.

If the herd is spendthrift and reckless, then the herd will win in a democracy even if the results are catastrophic.

Anonymous said...

If countries like Spain and Italy, etc have got as big a problems as Britain or worse, howcome they are able to buy up to many British companies and banks? when recently the reverse doesn't happen?

APL said...

Anon: "howcome they are able to buy up to many British companies and banks?"


Eventually, the condition will be recognised and certifiable. Just know though, the lunatics are running the economy.

togo said...

Good to know that there is still something distinctive about the Germans and that they haven't been completely re-educated/degraded by the cultural Marxist Anglo-Americans.