The German Economy on The Verge of Collapse -- The Whole EU Project is Crumbling !!

Rezession! That's how you say Recession in german. German economy barely grew at the end of 2019. The German economy is in stagnation since the summer of 2018, and it is getting worse by the month. In the fourth quarter of 2019, There has been zero growth. The manufacturing halted, while the coronavirus could be the final nail in the coffin of the German industry. VOLKSWAGEN is the most exposed, as 40% of its production is Made In China. Manufacturing accounts for a larger share of German economic activity than it does for most other developed economies: 20%, compared with 9% for the UK for example, and 10% for the US. The German economy is heavily invested in the export of motor vehicles and with Western governments vilifying the internal combustion engine, putting the brakes on car purchases. Governments need to consider the alternatives before shooting from the hip on engine banning. Germany is also very exposed to the tensions in international trade that have arisen, or at least become more intense, since US President Donald Trump took office. That related directly to new tariffs that his administration has applied to aluminum and steel tariffs, and indirectly to the trade war between the US and China. Because both countries are important markets for German industry, any damage they inflict on one another can affect sales of German goods. Germany would also be vulnerable if President Donald Trump was to act on his threat to impose 25% tariffs on imports of cars from the European Union. So even Germany, the powerhouse of Europe, stopped growing. Alongside Britain and France, the three largest economies in Europe. I genuinely feel that the EU leaders must rue the day that they failed to properly negotiate a compromise with the UK (and Cameron) prior to the Brexit referendum. They alone decided to call a bluff, believing all along that the UK would never leave. They should bear a heavy burden of responsibility and guilt, with the German economy slowing down. How are they going to find the funds to cover the shortfall of the UK leaving the EU. Even for Germany, this is going to be hard to get past the German voters. If Germany thinks it has problems now; wait until they finally realize they are the only remaining member of the EU 27 after the UK (UE's second-biggest contributor) leaves totally at the end of this year to be able to fill the black hole left in the EU's budget when it's second-biggest contribution (the UK) ceases on December 31st, 2020. The Euro has fallen to its weakest level in almost seven years as weakening manufacturing puts Europe’s largest economy on the brink of recession. The German GDP contracted in the first quarter, and it could shrink again in the second, sending the economy into recession. On top of this bad news, it appears the European Union is finally moving towards crunch time with the BREXIT. Clearly, low-interest rates and easy money have not cured Europe's problems, and the area continues to face growing anti-EU sentiment. Germany will continue to collapse due also to population decline. By 2060 the government expects the population to plunge from 81 million to 67 million, a decrease that is being accelerated by depressed areas in both eastern and western parts of the country that are hemorrhaging large numbers. The UN predicts that, by 2030, the percentage of Germans in the workplace will drop 7% to just 54%. No other industrial land is as starkly affected – and this is despite a strong influx of young migrant laborers. In order to offset this shortage, Germany needs to welcome an average of 533,000 immigrants every year, which perhaps gives context to the estimate that 800,000 refugees are due to come to Germany this year. Also, German household energy bills are soaring because of the change to renewable energy, which reduces domestic demand. Industrial energy prices also climbing fast. The factories are moving abroad to reduce costs. Volkswagen coal power stations shutting and changing to gas, not green renewable. It's too expensive. They would go bust. Domestic households are paying the price for renewables reducing demand elsewhere. The true goal of Socialism is the collapse of the industrial economy, stripping the working and the middle class of all the gains in lifestyle brought about by the use of fossil fuels and the economies of mass production. When it's all over, the world population would be reduced to such a degree that mass production ceases to be economical. With fossil fuel use banned, only the elite would enjoy the benefits of 21st-century technology, and the lower classes would be reduced to Medieval serfdom. Socialism is a regression back to Feudalism, for dependence on government is the same as the serfs huddling around the castle of their local lord for protection. Welcome to The Atlantis Report. The German economy had another very weak three months at the end of last year, according to official figures. The German economy remains stuck between solid private consumption and a paralyzed manufacturing sector. The picture of the German economy is clear: it has been in stagnation since the summer of 2018. In particular, the manufacturing sector remains trapped between cyclical weakness, following the trade conflict and weaker global growth, and structural weakness, due to disturbances in the automotive sector and insufficient investments. Looking ahead, the latest soft indicators and industrial data for December do not bode well for the short-term outlook. Furthermore, the impact of the coronavirus on the Chinese economy could delay any rebound in the German manufacturing sector since it stops at least temporarily the supply chain. Germany is also very exposed to the tensions in international trade, and the weak new GDP figures partly reflect a fall in overseas exports. Compared with the same period in 2018, GDP was higher by just 0.4%. Although there was some expansion, growth was reported at 0.0% when rounded to one decimal place by the German statistics office. The sluggish performance was down partly to a decline in exports. Investment in machinery and equipment was also down considerably between October and December. The statistics office doesn't offer an explanation, but it is certainly possible that that reflects the uncertain outlook for international trade. One factor that is likely to weigh on manufacturing firms when considering whether to invest is what sort of barriers they will face, which could make it more difficult to sell their goods abroad. The industrial crisis is the main cause of the sudden slowdown in the German economy. In 2019, Germany's GDP grew by only 0.6%. Much less than 2018 and 2017, when it marked growth of 1.5% and 2.5%, respectively. The one announced is the lowest growth in the past six years. And for the German Federal Statistical Institute, the reasons are to be found in the prolonged crisis of the industry of what was once called the locomotive of Europe. Economic production in the manufacturing sector decreased by 3.6%, but to have contributed to the decline, was primarily the weakness of the automotive industry. The slowdown in German growth was widely expected, both from the forecasts and looking at the GDP trend in the first three quarters of 2019 when Germany also risked the technical recession. According to estimates by the EU Commission, Berlin is penultimate for growth among the 28 countries of the European Union: only Italy is worse. On the other hand, the two economies are very integrated. In 2018, Italian exports to Germany reached 58.1 billion euros (+ 3.8% compared to 2017), especially semi-finished products and components for the automotive sector. While the value of imports stood at 70.3 billion euros (+ 6.8% compared to 2017), this is why the bad state of health of the German economy is not good news primarily for Italy. Another major problem for Germany remains exports, which suffer from the general slowdown in world trade due to tariffs between the United States and China. Looking to the next few years, while tensions between Washington and Beijing have subsided, disputes between the US administration and the European Union are worrying. In this climate of uncertainty, comments the Handelsblatt, German companies invest less: the uncertainty index of the Institute for German Companies (IW) at the end of 2019 was at levels close to those of autumn 2008 when the global financial crisis happened. In addition, in Germany, the emergence of the auto sector in this transition phase, following dieselgate, towards electric motors, is increasing the difficulties. For all these reasons, concludes the German economic newspaper citing Allianz's forecasts, a strong recovery in Germany is not expected for 2020 either. Estimates are speaking of the growth of + 0.6% of GDP this year, only to return above the percentage point of increase only in 2021. German industrial production fell 0.6% in September, the last month of the third quarter, which could mark the entry into the recession of the largest European economy, according to figures released Thursday by the Federal Statistical Office. This statistic, closely scrutinized as the country suffers for more than a year from a manufacturing sector which was traditionally its strength, is less good than expected by analysts, who expected -0.4%. In detail, the manufacturing industry contracted by 1.3% while the construction sector (+ 1.8%) and energy (+ 2.0%) increased. After a decline already observed of 0.1% in the 2nd quarter, a further decline would mean that the country would be in a technical recession. In detail, the production of capital goods fell by 1.5%, that of semi-finished goods by 1.3%, and that of consumer goods by 0.5%. Compared with September 2018, German industrial production decreased by 4.3%. In July, it had decreased by 0.4% compared to September, before rebounding in August (+ 0.4%). An unexpected rebound in industrial orders, as announced by Destatis on Wednesday, had supported the hope that the free fall of the manufacturing sector, and with it, the economy as a whole, would stop, notes Carsten Brzeski, an economist at ING. The German export economy is particularly affected by the economic slowdown precipitated by protectionist measures and Brexit. The German economy in free fall is approaching a recession. Germany is having an extremely complicated 2019 in terms of industry and exports. These two sectors, which are usually the locomotives of the economy of the country, are today bullets. The leading European power is heading for a recession. The Ifo Institute, an economic institute in Munich, announces that partial unemployment is increasing in industry. More and more companies are using it while polls tell us that 12.4% of employers expect to do the same in the next three months. The morale of German exporters has dropped significantly. In the industrial sector, the forecast for foreign sales fell from -2.3% in August to -5.2% in September. Germany is plagued by a drop in industrial production as the latest figures show a drop of 5.2% from last year. Exports also fell by 8%. Despite communication from the German government that just points to a temporary economic slowdown, the recession is well on its way to the country. The media, in turn, begin to make headlines about the approaching Rezession. The fall of the German economy is due to many external factors such as the trade war between the Americans and the Chinese, which causes a fall in growth and the fear of investment. The hard Brexit that is looming more and more in the United Kingdom with a Boris Johnson who is ready to do anything not to lose face. Despite everything, the German government remains fairly passive despite market concerns. Experts call on the authorities to revive the economy by funding new poles of development and / or modernizing public infrastructure. Whether it’s public or private, Germany is investing too little. Too little in roads, bridges, digital infrastructure. And still too little, too, for training, research, innovation. The federal government should adopt a cyclical investment program now to stabilize the economy. Germany expects new growth figures for early November. Perhaps an opportunity for the government to announce new economic measures in the face of the looming recession. Several German regions have already declared themselves in recession. The far-right is taking advantage of the current economic crisis to make a bed for the underprivileged and middle classes who are seeing their purchasing power wane. The issue of coal factories is also debated in a country that has invested hundreds of billions of euros in renewable energy. Like the rising price of gasoline for yellow vests, plant closings are said to cause major riots in already poor regions. France, through the voice of finance, called on Germany not to wait for the recession to act. "Germany must invest and must invest now, the sooner, the better," said French Finance Minister Bruno Le Maire, The German situation continues to weaken the European Union, which sees its first power totally destitute in the face of the economic crisis. Angela Merkel, sick, sees the far right continue to progress on lands in economic difficulty without it being able to react. Those paying attention to the global picture will recognize this is not just a German issue but is endemic across all developed economies and will only get worse. No single causative factor means there is no simple solution, and those hoping for a quick resolution will be disappointed — Batten down the hatches. This was The Atlantis Report. Please Like. Share. And Subscribe. Thank You.
















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