'Rezession' Is German for Recession
The analysis of the eurozone crisis is focusing mainly on sovereign debt and the bailouts, but I think we are starting to reach a more fundamental breakpoint. The working assumption is always that Germany is the "engine of growth" in Europe, and that its strong export economy would enable it to pay for many of the bailouts.
The question not being asked is: To whom will Germany export once the peripheral countries either default or implement massive austerity in order to get the tail end of loans from the European core? The "debt" problem is in reality a balance-of-trade problem. Germany ships shiny new BMWs to Greece and Portugal, and in return gets -- well, nothing but an IOU. Germany has been loaning the periphery the money to buy its products. If Germany does not loan more, how will the periphery buy German products?...187 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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