Relevant and even prescient commentary on news, politics and the economy.

The German euro is undervalued

I keep telling people that the German euro is undervalued, but some folks seem not to believe me. (See the comments section from this post last year for an example.) But this is a really big deal. The dominant narrative about the eurozone crisis is that fiscally irresponsible countries like Greece were bringing the once-proud […]

1/24/12 Links worth noting: Germany rejects Swiss banking secrecy deal; Labor Devaluation

1/24/12  Links worth noting by Linda Beale: Germany rejects Swiss banking secrecy deal;   Labor Devaluation  David Jolly, German Lawmakers Reject Swiss Tax Deal, New York Times (Nov. 23, 2012).The US and other countries like Germany have been pressing the Swiss on their bank secrecy, which allows U.S. and other foreign citizens to establish bank accounts without […]

Germany the Euro winner?

Update: This post from 6/28 has been re-posted today 7/04 as I believe it was lost in last Thursday’s reaction to the Supreme Court’s ruling on the health care ACA. Robert Waldmann has also subsequently expressed an opinion on how Germany should proceed. Re-posted:The NYT carries a data filled op-ed by Gunnar Beck, and takes […]

German Construction Is Looking a Bit ‘Bubbly’

by Rebecca Wilder German Construction Is Looking a Bit ‘Bubbly’ Eurostat released its volume-adjusted estimate of construction for April (release here, .pdf). Over the month, Euro area construction declined 2.75% following a large 11.41% monthly increase in March. Across the countries that make monthly data available (8 countries total), Slovenia and Portugal saw the largest […]

European Policy Makers Don’t Understand But Markets Do

By Rebecca Wilder European Policy Makers Don’t Understand But Markets Do So here we are: the Italian yield curve is flat at above 7%; the government institution is in question; and the ECB is using its SMP purchase program as a carrot to drive austerity implementation in and Berlusconi out. Some would argue that the […]

Don’t Hold Out for a Lasting German Economic Rebound

by Rebecca Wilder German industry is plugging away. Ending in August, the 3-month average of the seasonally- and calendar-day adjusted volume of industrial production (excluding construction) maintained a quick 8.3% annualized pace. Even if this core measure of industrial activity falls another 1% in September, the Q3 quarterly annualized pace would be 10.5% – a […]

Wilder on ‘Real retail sales in Europe: will German consumers save the day? Maybe, perhaps’

After the US report on Q2… Angry Bear and credit market weakness in the eurozone, Rebecca takes a look at the retail side of the economy: Retail sales in Germany and Spain were reported last week for the month of June. On a working-day and not-seasonally adjusted basis, real retail sales fell 7.0% on the […]

"Survey says"…. German growth has probably peaked

This week further evidence has emerged of Germany’s slowing growth trajectory. At 4.9% annual growth (calendar-adjusted) and a tightening bias from the ECB, this was, of course, to be expected. READ MORE AFTER THE JUMP!Yesterday the Manufacturing May ‘Flash’ PMI by Markit Research highlighted, in my view, that sentiment is unlikely to remain at these […]

Euro area GDP report: unbalanced

Today Eurostat released their estimate of Euro area growth for the first quarter of 2011. The economy grew smartly, or 0.8% on the quarter on a seasonally- and working day- adjusted basis. On the face of it, Euro area growth, which is 3.3% on an annualized basis, dwarfs the 1.8% seen in the US economy. […]

Europe’s industrial new orders: 3 very different stories

Spain vs. Germany vs. UK: production trends showing holes in some growth stories Eurostat reports new orders for January: In January 2011 compared with December 2010, the euro area1 (EA17) industrial new orders index2 rose by 0.1%. In December 20103 the index grew by 2.7%. In the EU271, new orders increased by 0.2% in January […]