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  #27  
Old 11-03-2011, 03:47 PM
dieter dieter is offline
 
Join Date: Dec 2008
Posts: 237
Default I didn't blame China

Quote:
Originally Posted by Florian View Post
Since, as you noted earlier, 50% of German trade is with other EU countries, I am somewhat surprised to hear you blaming China for low rates of consumption in Germany.
No, I did not blame China. I used China as an example to illustrate the relationship between Germany and the rest of the Eurozone. I did this, because Americans understand that China subsidizes its exports vis-ŕ-vis the rest of the World via currency exchange rate suppression.

The Chinese are bestowing us with free widgets in order to entice our corporations to set up shop in China. We, the consumers profit from this, not the producers.

Quote:
Originally Posted by Florian View Post
If exports only "make you rich" if you can purchase valuable goods from your trading partners, Germans could become richer by purchasing more luxury goods from France (for example).

Isn't the problem that Germans have an idea of wealth that puts more emphasis on savings than consumption?
You mean the problem that South Europeans put more emphasis on consumption than on savings? ;-)

The Germans can't afford French luxury goods because of declining wages: http://www.social-europe.eu/wp-conte...Euro-area1.jpg

Germans are traditionally modest, when it comes to wage negotiations. Southerners on the other hand traditionally demand to much. Appreciation of the Deutschmark and depreciation of southern currencies currencies used to balance these different behaviours in the past.
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