Merkel: Wir schaffen das, denn Deutschland ist ein starkes Land

 Die Neujahrsansprache, 2016

Verkürzt:  1:50



"...in diesem Sinne wünsche ich Euch Gesundheit, Kraft, Zuversicht (confidence) und Gottes Segen (blessing) für das Neujahr, 2016."

Hier, die Ansprache in voller Länge:  6:45

Angela Merkel: Time Magazine's Person of the Year

Opposition to her in Germany and throughout Europe is building, so perhaps this kind of recognition will help open some minds to the benefits of her logic. For me, just thinking about an alternate to Merkel can be a frightening thought. --rsb

["During Time‘s Person of the Year search, the magazine invited Donald Trump for a shoot with a patriotic theme." -- That was a challenge he won't soon forget.  That, and probably also that he lost to Merkel.  rsb]

Youtuber LeFloid interviewt Frau Merkel

Viele von den Fragen kamen von LeFloids Youtubeanschauer




HIER GIBT ES KURZE LEBENSTANDARD VIDEOS

Dialog:   Gut Leben in Deutschland!   Gutleben.de

Eine Freundschaft

ZWISCHEN (BETWEEN) ANGELA MERKEL UND BARACK OBAMA

Hier ein Fotogallerie

9. November: Only 1 more day left in Berlin's lighted balloon celebration

9. NOVEMBER BERLIN NACH 25 JAHREN:  CELEBRATE ALONG WITH THE PEOPLE OF BERLIN!

Welches ist dein Lieblingsfoto?  Which of the above photos is your favorite? 

Deutsche Welle published the photo below to accompany an article about the weekend celebration in Berlin.  The tourist board reported that there were over a million participants.  Some of the day's highlights were:

• The opening of a new museum chronicling the lives of some of those caught up in fleeing this wall, including a two-and-a-half hour visit by Chancellor, Angela Merkel.
• Beethoven's "Ode to Joy" (which has become the European Union's anthem)
• The release of those 7000 white helium-filled balloons which lined much of the old wall. 
•  Fireworks and Light Show

SATURDAY NIGHT LIVE: OBAMA PRESS CONFERENCE -- mit Angela Merkel

ganz am Ende

HIER IST DER FILM

Lustig, nicht wahr?

Gleich danach singt PENTATONIX das Lied, Little Drummer Boy. 
Ich fand das sehr schön!

Barack Obama 'approved tapping Angela Merkel's phone 3 years ago'

Guten Tag Frau Baker!

I found this article about the controversial issue about the phone spying going on, and it seems to be a major issue in Germany. I found this article very interesting because it tells us how Obama has actually been approving this spying.

I got the article from the Telegraph Media Group.
Auf wiedersehen!

Sam

Danke, Sam.  

I'm glad to share this article here.  I've bolded the references of the German publications which provided the sources, and added italics to the quotations hoping to help make it easier to read.

RSB 

President Barack Obama was told about monitoring of German Chancellor in 2010 and he allowed it to continue, says German newspaper

President Barack Obama was dragged into the trans-Atlantic spying row after it was claimed he personally authorised the monitoring of Angela Merkel’s phone three years ago.

The president allegedly allowed US intelligence to listen to calls from the German Chancellor’s mobile phone after he was briefed on the operation by Keith Alexander, director of the National Security Agency (NSA), in 2010.

Mr Obama was told of the secret monitoring of Mrs Merkel by General Keith Alexander, the head of the NSA, in 2010, according to Bild am Sonntag, a German newspaper. Photo: AFP/GETTY

The latest claim, reported in the German newspaper Bild am Sonntag, followed reports in Der Spiegel that the surveillance of Mrs Merkel’s phone began as long ago as 2002, when she was still the opposition leader, three years before being elected Chancellor. That monitoring only ended in the weeks before Mr Obama visited Berlin in June this year, the magazine added.

Citing leaked US intelligence documents, it also reported that America conducted eavesdropping operations on the German government from a listening post at its embassy beside the Brandenburg Gate in Berlin, one of more than 80 such centres worldwide.

Mr Obama’s European allies will now ask him to say what he personally knew about the NSA’s global eavesdropping operation and its targeting of world leaders, including those from friendly states. The White House declined to comment on the German media reports.

Last week, however, Mr Obama assured Mrs Merkel that her phone is not being monitored now – and will not be in future. But the US has pointedly declined to discuss the NSA’s actions in the past.
Its surveillance operations raises questions about whether US officials breached domestic laws. Hans-Peter Friedrich, the German interior minister, said: “If the Americans intercepted cellphones in Germany, they broke German law on German soil”. He noted that wiretapping was a crime in Germany and “those responsible must be held accountable”.

Even before the latest reports, German intelligence chiefs were preparing to travel to Washington this week to demand answers from the NSA about the alleged surveillance of Mrs Merkel.
John Kerry, the US secretary of state, received a dose of European fury this weekend when he visited Paris and Rome. The trip was arranged to discuss the Middle East peace process, the Syrian civil war and Iran’s nuclear programme. Instead, he was confronted by outrage over the scale of US surveillance operations.

“The magnitude of the eavesdropping is what shocked us,” said Bernard Kouchner, a former French foreign minister, in a radio interview. “Let’s be honest, we eavesdrop too. Everyone is listening to everyone else. But we don’t have the same means as the United States, which makes us jealous.”
According to the leaked documents in Spiegel, NSA officials acknowledged that any disclosure of the existence of the foreign listening posts would lead to “grave damage” for US relations with other governments.

Such posts exist in 19 European cities, including Paris, Madrid, Rome and Frankfurt, according to the magazine, which has based its reports on documents provided by Edward Snowden, the former NSA contractor.

Mr Obama did not comment, but Republican supporters of the US intelligence community began a fightback on the political talk-shows.

Mike Rogers, the chairman of the intelligence committee in the House of Representatives, said that America’s allies should be grateful for surveillance operations which targeted terrorist threats. “I would argue by the way, if the French citizens knew exactly what that was about, they would be applauding and popping champagne corks,” he told CNN’s State of the Union.

“It’s a good thing. it keeps the French safe. It keeps the US safe. It keeps our European allies safe.”
Peter King, a fellow Republican congressman, said that Mr Obama should not apologise for NSA operations in Europe. “The president should stop apologising, stop being defensive,” he said on NBC’s Meet the Press. “The reality is the NSA has saved thousands of lives not just in the United States but in France, Germany and throughout Europe. Quite frankly, the NSA has done so much for our country and so much for the president, he’s the commander in chief. He should stand with the NSA.”

John Schindler, a former NSA official, noted that planning for the terrorist attacks on Sept 11, 2001 had taken place in Hamburg.

“If 9/11 had happened to Germany and been planned in NY not Hamburg, I’d expect [German] intel to monitor USA top 2 bottom,” he wrote on Twitter.

A German intelligence official, quoted by Die Welt, said: “The Americans did not want to rely exclusively on us after September 11th. That is understandable.”
 
Another told the newspaper: “Without information from the Americans, there would have been successful terrorist attacks in Germany in the past years.”

Politische Debatte: Merkel und Steinbrueck

Und wer moderiert?  Kann es auch Stefan Raab sein?  (Could Stefan Raab also be the political moderator of this debate?)

---------------------"Das TV-Duell"--------------------



Themen:  Wahl-O-mat!  (the online program that helps you select the political party that best fits your beliefs)
               Pkw-Maut!   (tolls on the Autobahn)
               Steuer   (taxes)
               Sozialgerechte  (social rights)
               Kinderbetreuung   (child support)
               starke Wirtschaft; groesste Europas   (a strong economy; the largest in Europe)
               neue Ideen
               keine neue Belastung  (no new debts)
               die Staerkeren den Schwaecheren helfen  (the strongest help the weakest)
           
               Was noch?  (What else?)

Wer gewinnt?    Wie moechte Stefan waehlen? (How would Stefan like to vote?)

Merkel triumphiert, FDP raus, Hoffnung für AfD schwindet

Frau Merkel mit ihrem Mann, Professor Doktor Joachim Sauer 

(Schau auch Frau Merkels Halskette mal an!)

DIE WAHL, 2013
       Hier sind die Erwartungen (Expectations):            

Und die Ergebnisse (Results)?

BLUMIO raps the vote: CDU (Merkel)

HIER IST DAS RAPLIED.  
Was verstehen wir?

Elections in Deutschland: Does Angela Merkel have what it keep her party on top

 -- and thus, to keep her job as Prime Minister?

Hier:  DIE DEUTSCHE WELLE  TV highlights from the candidates' one public debate.

Im Fernsehen: Angela Merkel rappt mit? Jawohl.

 "Hätte, hätte - Fahrradkette"  KONJUNKTIV BEIM RAPPEN 

Steinbrück rappt den Konjunktiv

"Zuletzt noch fett im Meinungstief, jetzt schon satt im Konjunktiv":

Kanzlerkandidat Peer Steinbrück legt seine Interview-Blüte "Hätte, hätte -
Fahrradkette" als Musikvideo auf.
Die Berliner SPD-Stars unterstützen seinen Coup im ARD-Morgenmagazin als Background-Sänger. Und auch die Kanzlerin rappt mit.

Heute vor 14 Tagen interviewte der Moderator Sven Lorig im ARD-Morgenmagazin Peer Steinbrück, bekanntlich Kanzlerkandidat der SPD. Unter anderem ging es um den Parteislogan "Das WIR entscheidet!", zuvor schon Slogan einer Zeitarbeiterfirma. Auf die Frage, ob man diesen nicht durch eine einfache Google-Suche zuvor hätte abklären können, antwortete Herr Steinbrück: "Hätte, hätte - Fahrradkette ... !" Genau dieser Ausspruch war ein Anlaß für den Chefsatiriker des ARD-Morgenmagazins, Udo Eling, daraus mit seinem Team einen Song zu kreieren, welcher heute früh in der Sendung ausgestrahlt wurde - mit dem Ergebnis, daß er so zahlreich aufgerufen wurde, daß sich die ARD entschloß, ihn auch bei Youtube hochzuladen.

Hier der Link zu dem Song "Hätte, hätte, Fahrradkette!"


Men: Peer Steinbrueck, Frank-Walter Steinmeier, Sigmar Gabriel. They were
generally considered the leadership troika of the SPD and the party had wanted
to postpone picking one of them as challenger for Merkel until as late as
possible. Because of some developments, Steinbrueck became the contender. He
has had several scandals since: He collected speaking fees from a number of
businesses and business associations, he mused about the pay of the
chancellor, and he picked a an election slogan which had been used by a
temporary employment agency.  In the song, the three of them allude to all
kinds of previous SPD politicians and to a bunch of scandals, both those of
Steinbrueck and those of decades past.

The women are 1. Manuela Schwesig [not totally sure here], who has come to the
limelight as a speaker on social and women's issues, currently serving in the
government of Mecklenburg-Vorpommern; 2. Hannelore Kraft, who won an outright
victory for red/green against the CDU/FDP in Nordrhein-Westfalen after heading
a minority government for a while. She was rumored to be a contender for the
chancellorship, but probably want s to establish more of a tack record for
herself before she moves on; 3. Andrea Nahles, party manager and exponent of
the left wing of the party.

Außer Frau Kanzlerin Merkel, wer spielte mit? 
Per Eckhart:  Die Männer sind:  
1. Peer Steinbrück,
2. Frank-Walter Steinmeier,
3. Sigmar Gabriel  (all three generally considered the leadership troika of the SPD; the party had wanted to postpone picking one of them as challenger for Merkel until as late as possible.
Because of some developments, Steinbrück became the contender. He has had several scandals since: He collected speaking fees from a number of businesses and business associations, he mused about the pay of the chancellor, and he picked a an election slogan which had been used by a temporary employment agency.
--In the song, the three of them allude to all kinds of previous SPD politicians and to a bunch of scandals, both those of Steinbrück and those of decades past.

Und die Frauen (vielleicht; nicht sicher: ) 
1. Manuela Schwesig; has come to the limelight as a speaker on social and women's issues, currently serving in the government of Mecklenburg-Vorpommern;
2. Hannelore Kraft; won an outright victory for red/green against the CDU/FDP in Nordrhein-Westfalen after heading a minority government for a while; rumored to be a contender for the chancellorship, but probably wants to establish more of a tack record before she moves on;
3. Andrea Nahles;  party manager and exponent of the left wing of the party.

Spiegel: Promoting an Economic NATO

The World from Berlin: 'It's Worth Promoting ECONOMIC NATO' - SPIEGEL ONLINE »
By Daryl Lindsey

 Greener pastures from US-EU trade? A container ship enters the North Sea from the Elbe River in Germany.

The European Union and United States say they will soon begin negotiations to create the world's largest free-trade zone. German editorialists argue a deal is necessary if the West wants to help shape global politics and address the challenge of a rising China.

US President Barack Obama and German Chancellor Angela Merkel both believe this figure could be increased significantly, adding some much needed economic stimulus in America and Europe.
"An EU-US free-trade agreement would create a new drive for the economy, investments and jobs -- on both sides of the Atlantic," German Economics Minister Philipp Rösler told the German daily Handelsblatt.

In Brussels, European Commission President Jose Manuel Barroso has described the potential deal as "ground-breaking ... a game-changer" -- and it is one that wouldn't cost a cent.

Together, the US and EU want to boost their economies, jobs and present a united front against the growing economic strength of emerging superpower China.

There are many hurdles confronting this "economic NATO," particularly when it comes to food and agriculture -- with European concerns over chlorine-rinsed chicken, hormone-treated beef and genetically modified crops, and American concerns over strict European regulations. But Europe and the United States have agreed to enter into negotiations aimed at eliminating barriers on the flow of goods and services and creating the world's largest free-trade zone.

Talks are expected to begin on the margins of the next G-8 summit in Britain on June 18, German newspapers are reporting on Thursday. Initially, Washington had expressed a lack of interest over a possible deal, but Germany's Merkel has gently nudged two successive administrations since 2007 and it is believed that a personal telephone call prior to Obama's State of the Union address helped remove remaining concerns. Conservative British Prime Minister David Cameron has also pushed for a deal.

The trade agreement aims to go far beyond just trade and services, and negotiations will also strive for common regulations and standards on issues like product safety and intellectual property. A widely cited example are differing automobile safety standards that require a company like Audi to produce different versions of its cars for the American market.

On Thursday, editorialists at leading German newspapers praise the effort, with one financial daily even describing a "United States of the West."

• Center-left Süddeutsche Zeitung writes:

"The project is extremely ambitious, with some Atlanticists already speaking of an 'economic NATO'. That term isn't totally out of place either. The NATO military alliance was once established to protect against the threat of the Soviet Union. The idea of a new economic alliance also has found so many supporters because the old industrialized nations fear that they are falling behind the emerging economic power of China. The fact that negotiations are even taking place is a success for German Chancellor Merkel, who has been pushing the project for years despite an initial lack of interest in Washington. Obama's economics team also held off for a long time because his advisors felt the initiative would be too complex."

"The fact is, an economic NATO would be a major venture. The EU and the US are already tightly interwoven economically. … Despite this, 1.5 percent annual economic growth could be created if the remaining barriers were removed. The only problem is that eliminating these barriers would trigger protests of myriad interest groups and also require considerable political capital. It could also test European solidarity. In London and Berlin, the political classes tend to be oriented towards the free market, whereas protectionism often lurks in Paris."

"Resistance is already forming. In the future will we (Europeans) be forced to eat chlorine-rinsed American chicken? Will we have to sow the seeds of genetically-modified corn on our fields and accept America's lax data privacy provisions? Or, from the American perspective: Will we have to tolerate the Europeans' obsession with regulations?"

"Regardless what the outcome of the talks is, the fact that they are even taking place is extremely advantageous for the Europeans. The EU is now getting a future-oriented project that will allow it to look away from its own problems as well. A free-trade agreement would further open the Continent and could also foster trust between the Americans and Europeans and set standards for the rest of the world. It's worth using all of our energy to promote an economic NATO."

• Center-right Frankfurter Allgemeine Zeitung writes:

"Finally, one wants to call out, the US and EU are willing to turn an idea that has been bandied about in the political realm for some time now into a real project -- and negotiations are expected to begin soon for a 'Transatlantic Trade and Investment Partnership'. So President Obama isn't just answering the call of Asia -- he's also making the expansion of American-European economic ties a pet issue. Expectations for the mutual advantages of a free-trade agreement -- economically, politically and strategically -- are so great that one must ask why this wasn't already tackled sooner? But the rise of emerging economies and the challenges that presents wasn't a dominant issue until recently. Today, however, a response is needed, and every potential driving force for prosperity and the strengthening of the Atlantic community needs to be used."

• Conservative Die Welt writes:

"It appears that the differences on both sides of the Atlantic are now seen as surmountable. And that's very good news, because a free-trade agreement between the two economic zones would be the cheapest stimulus package one could conceive of. The European Commission expects that the reduction of trade barriers and the harmonization of standards and regulations would lead to annual GDP growth of 0.5 percent. Other estimates are even higher."
"But a common market would also send a powerful political message: Namely that the West wants to pull more tightly together to face the challenges coming from emerging powers in other parts of the world. Given America's current weakness in leadership, it is also necessary. Otherwise, Obama's speech had a clearly isolationist character. …. Only when the country's economic foundations are healthy again can (America) assume a global leadership role (Obama suggested)."

"This means that the trans-Atlantic free-trade zone at the same time has both economic and political significance. It is aimed at helping Europe and the United States recover economically. But it also makes clear that only an en ever-closer West can succeed in decisively helping to determine global policy. Given these considerations of overriding importance, the free-trade zone cannot be allowed to fail over niggling details."

Learn German to study Philosophy--to Comprehend Economics!

Germany's Battle with Morality
Submitted by Tick By Tick on 12/12/2011 03:02 -0500

During the spring of 1724 in the small city of Königsberg, a boy by the name of Immanuel Kant was born. Kant, an academic prodigy, endured a ‘strict, punitive and disciplinary’ (Wikipedia) education that would form the basis for his Critique of Pure Reason. Kant’s most famous work focused upon the idea of the Categorical Imperative; the duty that a human must fulfill a certain number of obligatory actions or mannerisms that should become universal laws of society. Or as Kant put it, “Act only according to the maxim whereby you can, at the same time, will that it should become universal law”.

This ideology is clearly identified in a scenario dubbed “The Inquiring Murderer”. In summary, the scenario is the following:

If one is hiding an innocent person in his or her house, and a known murderer knocks on the door asking if the innocent person is hiding inside, would it be morally correct to tell the truth at the risk of the innocent person's death, or to lie to the murderer in an attempt to save the innocent person's life?

Kant would argue that telling the truth is a Categorical Imperative and as a result should trump all other moral or ideological reasoning. Stay with me here, there is a key point to come.

Kant’s work, although academically disputed, has had a profound impact on the way that Government’s construct ongoing legislation to encourage the “correct” civil virtues in their populations. There is no greater proponent of these beliefs than Germany whose relentless pursuit of human dignity has resulted in enacted constitutional legislation to drive its inhabitants towards a higher regard for human dignity. So much so, that in the wake of the 9/11 it was ruled that a strategic destruction of a hijacked aircraft would be unconstitutional with regards to the human dignity of both the captives and the hijackers in their own right. Economically, this entrenched belief of human dignity has developed into somewhat of a Categorical Imperative towards rescuing the financially bankrupt countries or soon to be bankrupt countries of the Eurozone.

Fast-forward to 2011 and let's evaluate economic fundamentals that exist today within Europe. Of the 17 member states that adopted the Euro, we know that roughly 6 of them are broke (Portugal, Ireland, Italy, Spain, Greece and Cyprus); a list that seems to grow by the day as the Euro politicians shake off last night's hangover and finally get a grip with reality. Now some of you may be wondering, hasn’t Germany single- handedly rescued these countries and made Angela Merkel somewhat of a god-like figure in these states? … Not exactly. Germany’s resilience to letting its Euro brothers and sisters fall by the wayside seems to have formed somewhat of a Categorical Imperative in itself.

If we are to look at the 2008 crisis in detail, the fundamental issues lie between issues of policy, greed and pursuit of profit by individuals and firms alike. This "private sector" contraction, although difficult to swallow, resulted in economic calamity that was in many ways a far better situation than we are in now. For now, it is the governments that are broke and have fallen victim to the endless pursuit of political success and the idea of a relative improvement in quality of life. This rose tinted ideology is the overarching umbrella that sits above the private sector in both an authoritarian and protectionist manner. The reality is that this umbrella has shrunk to such an extent that the private sector sitting beneath it is going to get wet. In some cases (Greece, for instance) their umbrella is now so small that countries with a larger protection from the impending storm are lending a place of refuge. The justification for such practices to prevent contagion will eventually lead to the polar opposite outcome.

Without Germany, the Eurozone would already be a failed experiment and now it seems determined to drag itself down with the pack. In an interview on Bloomberg (9th August), one European politician was quoted in saying "we must chose between more Europe or less Europe. We will choose more Europe". Now this opinion is somewhat sensible for the likes of Greece who seem to have found themselves with an endless piggy bank called Germany but for the rest of the states one must question what exactly are these people smoking. The austerity measures entered into by a vast quantity of these nations are dependent on fixed price imports, improved exports and tourism. If you were to break down what would happen in an economic contraction, one must only conclude that the situation is going to be made an exponential amount worse with the inverse predictions happening.

Last week’s plan by the ECB to purchase members states bonds on both the primary and secondary markets should send alarm bells ringing. The reality is that Germany is using it’s own economy and low lending rates to fund the whole Eurozone area whilst increasing it’s exposure to 133% of GDP (Zerohedge). This is only going to end badly.

If we take a step back for a minute and consider a similar situation that occurs with aid in African nations we know this is the wrong thing to do. The effectiveness of financial relief is solely dependent on the social response of the people that are affected. Don’t get me wrong; aid in Africa is the right thing to do, however far more progress has been made through teaching the society better agricultural techniques and encouraging the practice of safe sex than has ever been made financially. Germany is making exactly the same mistake, the relaxed liberal European way of life needs a fundamental slap in the face to awake these societies that believe tax evasion is a birthright and that retirement at 50 is just how it is.

No no no Mr Berlusconi, life isn’t quite so much of a party as you make it seem.

What the Euro MP’s seem to have missed, is that these societal and policy values will prevent any credulous rescue package from success; a point that George Soros has been clear to advocate in his recent article entitled Three Steps to Resolving the Eurozone Crisis.

“Sadly, Germany has unsound ideas about macroeconomic policy, and it wants Europe to follow its example. But what works for Germany cannot work for the rest of Europe: no country can run a chronic trade surplus without others running deficits. Germany must agree to rules by which others can also abide.”

Instead, Mrs Merkel and Mr Sarkozy seem intent on wasting both time and valuable resources drafting new measures in an attempt to save the Euro from certain collapse. The one area of Soros’ article that this writer agrees to surrounds formulating a comprehensive exit mechanism from the Euro.

“In the absence of an orderly exit, the regime would have to carry sanctions from which there is no escape – something like a European finance ministry that has political as well as financial legitimacy. That could emerge only from a profound rethinking of the Euro that is so badly needed (particularly in Germany).”

Although a departure from the Euro may cause economic redress for other Euro denominated countries, the long-term effect would be to reduce the toxicity of the Euro and facilitate the payment of outstanding debts (at a significantly depreciated level). Although difficult to swallow, this is singularly the best option for the likes of Greece who needs to regain control of their monetary policy in order to get their house in order. The process wouldn’t be pretty or please the financial community but in many ways this self-sacrifice would provide the all-important Human Dignity to the Greek population that they deserve.

Instead, the latest meeting between Merkel and Sarkozy pledged to harmonise corporate tax and potentially introduce further taxes to aid deficit reduction. However, stupid the idea of taxing a faltering economy may sound (especially penalizing your own banks) some common sense did prevail out of Tuesdays meeting. Firstly, Germany seems to have finally checked its bank statements and realized that it is losing money faster than a junkie in Tijuana; this realization led Mrs Merkel to announce that the ECB piggy bank would not be increased to the magnitude previously expected.

Secondly, they dismissed the idea of Eurobonds; in this writer’s opinion, the best decision ever made by Europe’s Punch and Judy. Eurobonds would have effectively bred contagion despite what Mr Soros may believe. A Eurobond is effectively a Collateralised Debt Obligation where Germany is the A game and Greece is the Z, but unlike 2008, the investor friendly A game will risk life a limb to protect Z….You can see where this is going.

At this point, one must ask why Germany would even be interested in a Eurobond?

Lets suppose, I am Warren Buffett and I go into the market to raise $1bn. The market says, Warren you’re a smart guy, we trust you so we will lend to you at 3%.

Now lets suppose, I am Warren Buffett’s family, and I go into the market to raise $1bn. The market says, Warren is a smart guy but the rest of you? …Not so much; especially Uncle Charles who seems to be very overdrawn and the workers from his business are always striking. The best I can offer we can offer is 5%

With or without the intended puns, were we seriously expecting Germany to agree to this? They may have made some pretty stupid decisions but this really would have rocked the boat. So why did we expect it?

This deep-rooted answer comes back to the original point of the Categorical Imperative that Germany seems to have developed towards the rest of the Eurozone. The market is pricing in the idea that Germany will be there to stabilize the Eurozone area at least in the short term. But from what we have discussed, there are underlying concerns about the viability of this continuing. One must consider that Germany has already committed tens of billions of Euro’s towards helping it’s sick brothers with only a handful of overpriced to market rate bonds to show for it. So what happens next?

In the coming months, Germany is going to be forced into the situation where they must chose between the blue pill and the red pill knowing that whichever one they take, it is going to cost them an astonishing amount of money. Before we conclude, let’s talk through the two competing options.

Option 1 – Germany Continues to Bank Roll the Eurozone – Probability 70%

§ The market reacts positively in the short term but corrects once the fundamentals are evaluated

§ Germany increases it’s long term debt obligations during a contracting economy and finds itself with the mother of all overdrafts

§ Dream scenario (probability 1%) – Austerity measures prove effective within the PIIGS and Germany becomes the overwhelming power regarding all European matters



Option 2 – Germany Separates Itself from the Eurozone Debt Burden – Probability 30%

§ Markets contract but are reassured by long term viability of Germany’s economy.

§ Eurozone exit mechanism allows the contagious nations to leave the Euro in order to balance their books over the long term and reduce the toxicity of the Euro.

§ Germany retains free trade environment but looses the long term viability of a singular monetary union

It is clear that whichever choice is made, Germany will experience a significant opportunity cost. Should Germany promote an Exit Mechanism, the fundamental framework surrounding the EU in it’s entirety would be on the line. Conversely, should Germany support the Euro, its deficits would slowly constrict its economy and eventually cause a Eurozone Meltdown. This option is further complicated by the lean and organized nature of the German economy that would significantly weaken the effects of austerity and restructuring when compared to the likes of Greece.

The conclusion is clear, whichever route Germany takes in this shabacle there are going to be a lot of losers. However, the magnitude of loss will be in many ways dependent on Germany’s ability to act whilst time and the economy are on its side.

First published on 9th August 2011