Seeking Input from our German Readers

Adam Taggart
By Adam Taggart on Sun, Jul 7, 2013 - 11:42am

The stresses within the Eurozone can be simplified down to one question: Who will take the losses?

Too many countries spent beyond their means for too long. Now, as the debts are becoming increasingly unserviceable, those who lived prudently are being asked to subsidize those who didn't. 

With the miniscule exception of Cyprus bank account holders, the brunt of the bailouts are being funded by the German taxpayers. For the status quo to continue, an ever greater amount of Germany's treasure is going to be sucked into the seemingly bottomless money pit created by the profligacy of Greece, Portugal, Spain, Ireland, etc. Expect Italy and France to join that list soon and their debts are MUCH larger...

How much longer will Germany's populace put up with this arrangement?

That's a very important question. For if the Germans decide to stop giving their wealth away, the rest of the Eurozone becomes very unstable very fast.

If you're reading this and are either from Germany or spend time there:

  • What's the attitude of the average German on the streets on this issue?
  • Do you think the German public will indeed reach a point where they refuse to fund further bailouts?
  • If so, how near to that moment would you estimate they are?

Please let us know your thoughts in the Comments section below.

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ReginaF's picture
Status: Bronze Member (Offline)
Joined: Jan 16 2009
Posts: 93
Attitude towards bail-in and bail-out

Hello Adam,

the people in my neighbourhood (mostly middle class) as well as my collegues (mostly academics) are absolutely quiet about this, nobody talked about these topics.  

I spoke with some friends, neighbours and a few collegues about the bail in and the Cyprus Masterplan. Overall reaction: Denial. Seemed, that we are living in another world were all is ok  yet and  will be ok in the future.

A friend /the only one, who is slightly interested in my concerns about the foreseeable future said to me, that the economic and political developement is nothing but crazy and nobody in their right mind can understand what happend and what will happen.

And the sun shines, there is a lot of work to do, the day is too short and do you have experience with the new xxx (Smartphone or whatever technical gadget)....


Uh oh, my english today is not so correct - hope that you can understand what I want to express -:)))

Have a nice sunday



sand_puppy's picture
Status: Diamond Member (Offline)
Joined: Apr 13 2011
Posts: 2033
Can't believe its happening

Wow ReginaF,

So the Germans are just like us Americans.  The rapid changes are just too strange, too unthinkable, too disturbing to consider.  So we "change the channel."  Did you SEE that red dress Kim Kardashian was wearing!!

Adam Taggart's picture
Adam Taggart
Status: Peak Prosperity Co-founder (Offline)
Joined: May 26 2009
Posts: 3210
Vielen Dank, Regina

Excellent write up.

I observed a similar detachment when speaking to friends of mine from Hamburg a few months ago. They were aware of the Eurozone's trouble, but seemed to only have a mild interest in how it would play out. There just didn't seem much appetite for focusing on how big the risks might actually be.

I was surprised by the lack of indignation my German friends felt at the rest of Europe reaching into their national savings account. It sounds like your colleagues feel similarly. This is hard for my brain to process as I think I would be much more concerned/irate if in their shoes; but perhaps they just don't think of the situation in the same way I do, fundamentally.

Any other readers have insights to share here? 

Ivo's picture
Status: Bronze Member (Offline)
Joined: Jan 26 2009
Posts: 73
Same at the neighbors

We in The Netherlands are of course pretty much in the same boat as our friendly neighbors to the east, and sadly I can confirm the observations of Regina (herzlichen grüßen aus Holland!). To most people the situation of us funding mediterranean debt appearantly doesn't really register. Like as if it's fiction on TV, and it won't actually impact them. I suppose it's a combination of not wanting to hear bad news, the assumed complexity of the situation, and mainstream journalism doing a poor job.

treemagnet's picture
Status: Gold Member (Offline)
Joined: Feb 13 2011
Posts: 344
The US, as in

us, contributes more than any other country - by far, to cosmic bunny holes like the IMF and such - so Germany, which makes great products purchased by deadbeats of the industrialized world and more....thinks its gonna be immune from the 'Grandma has money so I want some' syndrome?  They can talk tough, but as long as you've built an expensive cradle-to-grave societal business model on selling high-end, top tier products and services to countries addicted to spending with little regard for the future, I'd say it just won't matter much.  To me, countries like Germany will maintain the "Titanic High Ground" - but the same fate awaits.  I've heard companies like Porsche bring in the vast majority of their revenue from engineering contracts, etc. - curious if anyone here knows the truth on that one.   IMHO, the only thing that gets 'fueled' from this mess is the willingness, desire and perceived need for governments to wage war over 'just' debts, losses, and agreements.

mammamia's picture
Status: Bronze Member (Offline)
Joined: Nov 9 2011
Posts: 33
Right now the situation in

Right now the situation in Italy and Germany are very different. People in Italy do not find work, when they find work they are paid much less then their teutonic brothers. But we were told that it was due to the fact that life in Germany costed much less. 


Then a video came out

And the guy showed how in a supermarket in Germany everything costs LESS than in Italy. My guess is that it is because of Italian taxes. Right now in Italy Italian taxes are really high, and who can leaves the country.


i am not an economic expert, but it is my understanding that in any one single country you always have areas where everything works better, and areas where everything works less well. And places where things do not work well are also the places where people do not want to invest making this a loop. If this was happening between two different countries the weaker one would inflate his money attracting investments with its cheap labour. When this happens between places inside a country (east west germany; south north italy; north south england) this is instead balanced by money invested from the central government.


The problem with the EU is that it is a monetary unit without the political or econmic unit. So the money spent in Greece is perceived as going into another country (bad) while the money going from greece to Germany of all the people running away from the crises is perceived as a fair result of their past monetary policies. 

This is unstable, and cannot continue like this. Either the EU will split or the EU will merge into a single huge nation. In that case Germany will not be required to loan but to give to poorer countries. Like west Germany gave to East Germany and still does. 

personally I am moving away from the PIIGS, not wanting to have my assets in a country that I think will soon have to fail, and before doing that will raise the taxes up like crazy. It is already happening, like in the video above.




JoeKuan's picture
Status: Member (Offline)
Joined: Jun 24 2013
Posts: 5
It will all be fine

In UK, the people around me think I am from Mars when I talk about debts, hyperinflation and precious metals. They all think the economy will be fine and even believe Japan economy will recover. If it is that simple to solve the economy by printing money, it will be done from medieval age and printed in all the history books.

My friends also think they can find a job relatively easy and even better than their current salary. It is real tough out there (as I have tested the water) and the market rate is around 20% less. I think the general public are either normalcy bias or affected by the media.  

The EU, US and Japan are stacking dominos by printing money. One day we all have to pay; one way or the other.

ReginaF's picture
Status: Bronze Member (Offline)
Joined: Jan 16 2009
Posts: 93
Ivo wrote: "Like as if it's

Ivo wrote: "Like as if it's fiction on TV, and it won't actually impact them. I suppose it's a combination of not wanting to hear bad news, the assumed complexity of the situation, and mainstream journalism doing a poor job."

Sand_puppy wrote: "The rapid changes are just too strange, too unthinkable, too disturbing to consider.  So we "change the channel."

Thank you both!! Your ideas sounded really true to me! And reminded me of a short story a read some time ago: Stefan Zweig remembered in his book "Die Welt von gestern (World of yesterday)" about the time of WW II, situations, when people do not weep about all the human tragedy around them, but when their stockings get a run, they might weep bitterly. 

Might be, that the change upon us is too unthinkable to most of the people.

Best from Germany (near Hamburg, dear Adam!)




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