De Graaf

What Is The Level Of Deflation Risk In Germany?

Constructe, you make a good point.

The foundation for that increase in standard of living in Europe is making sure that people receive the right policies and visions by choosing the right leaders in politics.

In America its all about money. The more money you throw at a campaign, the more voters you'll get by popularity. As if substance is on 2nd row... crazy way of politics.

The Europeans are more focused on itself and only vote when they think its necessary for the countries well-being. If policies in a particular country don't feel right or work out badly, they tend to choose another politician that does do the job right.

Here (Netherlands) a politician is chosen for its background and vision, not based on his/her charisma and popularity on first row. Its much more important to keep a budget balanced on the long term, rather than short term gains, increasing our kids liabilities.

Merry Christmas


On Dec 24 09:33 PM constructe wrote:

> It is interesting to note, while Europe has not had outstanding GDP
> growth over the past 2 decades their standard of living has increased,
> even in Germany which shouldered the cost for East Germany.
>
> The last decade the same can't be said for the US who fueled growth
> with a lot of debt and corresponding inflation and massive government
> spending (war doesn't really translate into any meaningful standard
> of living increases).
>
> Economic growth does not mean a better standard of living nor does
> it's stagnation mean a worse life. This holds especially true if
> the population increases or decreases significantly or when the growth
> is fueled through government expenditures on things which don't translate
> into goods or services to its citizens.

What Is The Level Of Deflation Risk In Germany?

Top notch article. The economic leader of Europe.

As a Dutchmen, we share a very strong relationship with the German economy, as the Dutch economy thrives when the German economy thrives. So 2009 will be a rough year considering these forecasts from above mentioned German institutes. So far, the Netherlands is doing relatively well, considering our fellow European neighbours.

Germany has always been a benchmark for the Dutch economy, (Germany being the largest exporter) so it is fair to say, that the problems are strongly corelated in both economies.

The Dutch economy does have good resilience considering its mainport function, having Rotterdam Europort and Schiphol Airport as feedlines for the backcountries like Germany and the emerging countries in Eastern Europe. The necessary import flow needed for bulk cargo goods (primary goods) will continue, be it at a slower pace.
This is one of the advantages of the Netherlands being a coastal country, knowing how to deal with water, dikes and trade.

As long as we keep innovating (bit low momentarily) we, the Dutch, will do fine. Having said that, the coming years are going to be harsch. At least the dikes are in good order, so the feet remain dry even during a possible depression-like recession (low expenditures) combined with a historic 1953 flood-event.

Merry Christmas,