Greece II or: How I learned to stop worrying and love the euro.

[A Horse Named Stranger]

But not huge on exports.

But that effect was not only because of the Euro.

It conincided with a goverment change in 1999. Kohl had been in charge of the country for 16 years, and Germany had some of the problems the Greek had and the France still has. Kohl did in his years of rule basically nothing to rock the boat, no needed reforms etc.

Then came Schröder he took on to tackle those unpleasent tasks. The voters have still not forgiven his Social Democratic Party and their former results are basically still cut in half from their former glory.

Chancellor Merkel is now sitting proud and tall ruling over the country like her master Darh Kohl. Doing nothing to rock the boat, and winning election after election.

[Arakan]

Well Germany has benefited quite a bit from the Euro, I guess we can all agree on that.

Ironies of history.

The Germans did not really want to give up their beloved D-Mark for the Euro.

And the Greek, who so desperately wanted to have the Euro...

Thanks to the fact that the world loves the stuff we produce, one can argue that we would have done fine under DM as well, see Switzerland.

Yes, we developed new markets because now those countries (like Spain) with hard currency could buy our stuff.

But to reduce German success to the Euro, like this DUDE Shryke is doing gives me the feeling that some simply hate our Post WW2 success story instead of taking it as Benchmark.

[Arakan]

I have. I'm not sure you actually understand what is the relevant data here at all.

Here's Krugman to lay this out for you in nice simple language:

http://krugman.blogs.nytimes.com/2013/11/03/german-surpluses-this-time-is-different/

Why do you think this matters? Seriously, we'd all really like to know cause you seem to think it's really important despite it making no sense.

Look up the WTO Data. It's free.

Even your article shows it.

Again: we were WORLD EXPORT CHAMPIONS in the 1980s, top 3 in the World for decades (speaking gross).

You know even the difference between gross and net? Where the fuck was I focusing on account balance (which btw is not TRADE BALANCE).

WHERE?

[Arakan]

I will provide a data analysis on monday.

This dude Shryke annoys me with his claims.

[Arakan]

I wait for the day that dude Shryke will apology for his impolite behavior.

[JoeyBanana]

I wait for the day that dude Shryke will apology for his impolite behavior.

Are you having a meltdown or something?

[Arakan]

Are you having a meltdown or something?

Why? Is it ok for Shryke to constantly tell other users "you don't understand" "you have no clue"

He does insult others on a constant basis.

Is this an ok behavior?

[TrueMetis]

Why? Is it ok for Shryke to constantly tell other users "you don't understand" "you have no clue"

He does insult others on a constant basis.

Is this an ok behavior?

WTF do expect someone who disagrees with your position to say? "you have a complete understanding of the situation but I'm going to argue against you anyway"

[Shryke]

Look up the WTO Data. It's free.

Even your article shows it.

Again: we were WORLD EXPORT CHAMPIONS in the 1980s, top 3 in the World for decades (speaking gross).

You know even the difference between gross and net? Where the fuck was I focusing on account balance (which btw is not TRADE BALANCE).

WHERE?

Did you skip over the giant hole in the middle of that graph in the 90s? The one that ends with the euro as Germany begins to take advantage of the currency union? It's all right there in what I linked. It's rather the point of the whole thing. And account balance is a good metric for taking a broad look at the German trade balance.

Are you having a meltdown or something?

Yes?

He certainly ain't addressing the point of the posts he's responding to.

[Arakan]

WTF do expect someone who disagrees with your position to say? "you have a complete understanding of the situation but I'm going to argue against you anyway"

No but to just say "you obviously understand nothing" is extremely rude and impolite!

At least where I come from!

[Shryke]

Why? Is it ok for Shryke to constantly tell other users "you don't understand" "you have no clue"

Because this is a discussion and when your points indicate you don't understand what you are referring to, that gets pointed out because it shows why your argument does not hold.

Given that you've spent the last many posts saying (erroneously) the exact same thing back at me, your complaints about this are rather hypocritical. What's good for the goose is not good the gander apparently. How quaint.

[Arakan]

Did you skip over the giant hole in the middle of that graph in the 90s? The one that ends with the euro as Germany begins to take advantage of the currency union? It's all right there in what I linked. It's rather the point of the whole thing. And account balance is a good metric for taking a broad look at the German trade balance.

Yes?

He certainly ain't addressing the point of the posts he's responding to.

You do know what happened in the 1990s in Germany?

When speaking about world Export Champion there are two categories: gross and net (trade balance Surplus or deficit). Germany was world Champions in both categories pre-Euro. Germany was constantly in TOP 3 since the 1970s in the gross category.

On monday I will provide the stats

[TrueMetis]

No but to just say "you obviously understand nothing" is extremely rude and impolite!

At least where I come from!

You must have the thinnest skinned people on earth where you're from.

[Arakan]

Because this is a discussion and when your points indicate you don't understand what you are referring to, that gets pointed out because it shows why your argument does not hold.

Given that you've spent the last many posts saying (erroneously) the exact same thing back at me, your complaints about this are rather hypocritical. What's good for the goose is not good the gander apparently. How quaint.

I will provide the trade statistics on monday

[A Horse Named Stranger]

Shryke but like I stated a few posts above, there was also that reform package by then Chancellor Schröder the so called AGENDA 2010, which contributed to Germany becoming competitive again. So it was not simply the Euro. I agree it helped, but it was not the sole course for the surging Germany economy.

[Arakan]

Shryke but like I stated a few posts above, there was also that reform package by then Chancellor Schröder the so called AGENDA 2010, which contributed to Germany becoming competitive again. So it was not simply the Euro. I agree it helped, but it was not the sole course for the surging Germany economy.

Yes German recovery in the 00s after the trouble in the 90s (in which we still were world top 3: GDP, gross exports) caused also by re-unification was thanks to internal reforms to a large degree.

[Shryke]

Shryke but like I stated a few posts above, there was also that reform package by then Chancellor Schröder the so called AGENDA 2010, which contributed to Germany becoming competitive again. So it was not simply the Euro. I agree it helped, but it was not the sole course for the surging Germany economy.

It was a huge part of it.

Here, the previous link did not include this bit which is quite relevant:

http://krugman.blogs.nytimes.com/2013/11/01/the-harm-germany-does/

Because you can actually track the flow of capital to the periphery of the eurozone that plays a major part in boosting the German economy in the 2000s. This is a big part of the story of the eurozone. It's silly to pretend it's not. It's even sillier to act aggrieved by this data. And yet...

[Iskaral Pust]

I have not been active in this thread because we said it all in 2013 and the latest iteration is more of a Punch & Judy show, but I will pompously share my sage opinion:

- monetary union without fiscal union or at least very similar economies can't and won't work. Lots of other countries have attempted pegs, gold standards and other variations on monetary union with the same results. The Great Depression was largely monetary at root, not caused by the 1929 stock market crash as the popular narrative suggests.

- The PIIGS all had below-market interest rates because of a wrong-headed political concession that all euro sovereign bonds would be treated identically for bank reserves. This resulted in a personal debt binge funded mainly by the big banks with the most capital (German and French), even while national debt shrunk. As much as people like to blame greedy banksters, the greed and short-sightedness was on both sides. Banks already took 50% haircut on Greek debt in 2013 but Greece will probably default further (blood from a stone), but they have to recognize then that their future cost of capital will be huge and will drag on their economic growth for a while. But lenders' memories are shorter than they should be, look at Russia and Argentina.

- PIIGS benefited from too-cheap money that fueled big growth while Germany and others benefited from a weaker currency and captive markets for exports, plus a hard-currency destination for their trade surplus.

- People still talk about 2008 like it caused a lot of these problems and others. 2007/8 is when a lot of unsustainable problems of several years finally reached a tipping point and were sharply reversed. It didn't ruin Greece or Ireland or cause low wage growth in America, it merely stopped the debt binge that that been hiding those problems for 5-10 years.

- austerity doesn't work to fix recessions, but at the same time foreign creditors are often unwilling to fund continued unsustainable spending (and why should they?). The answer is devalue and grow and/or financial repression to force citizens to lend to the govt at below-market yields (see current QE, WWII bonds in America, Japan for past 30+ years, China for past 10+ years, etc). Both of these are a tax on citizens in the form of reduced spending power and decline in standard of living, but they are more accepted by citizens than cuts in nominal spending.

- Greece doesn't have a big export economy but if it devalued enough it would grow. If nothing else, it would become a market for cheap labor. The Greek economy is captive to cronyism and protectionism, worse than France or even Italy and closer to Russia or a third world country. It cannot support a European standard of living until it reforms. It's not alone in facing this: Britain and Germany acted the earliest, Italy has finally started, France is still in denial. That doesn't mean Greece has to reform, but it cannot have both.

The economic facts are what they are. The rest is a Punch & Judy show for political consumption on both sides.

[Shryke]

:agree:

And yes, this does feel like the same shit all over again.

[A Horse Named Stranger]

It was a huge part of it.

Here, the previous link did not include this bit which is quite relevant:

http://krugman.blogs.nytimes.com/2013/11/01/the-harm-germany-does/

Because you can actually track the flow of capital to the periphery of the eurozone that plays a major part in boosting the German economy in the 2000s. This is a big part of the story of the eurozone. It's silly to pretend it's not. It's even sillier to act aggrieved by this data. And yet...

Yes, but the aforementioned Reform package reduced the high labour costs, which was a main cause for the dip in the German exports in the 1990s. That in combination with a unified currency worked greatly to Germany's benefit. Without it, Germany would be in a situation quite similar to France. The Euro had the double-edged blessing for the Southern States like Spain and Greece that they got loans at a more beneficial rate, which made them import more cheapened German goods. Greece and Spain are/were too expensive in terms of price for labour. Same with France, but they had a healthier economy to begin with. I am actually not acting aggrieved by what you say (why would I), sorry if it comes across that way. I am just arguing the whole thing was not mono-causal, which you made it sound like.