Can the imbalances in the euro zone be eliminated by more inflation in Germany?
Theoretically, this would be feasible. If Germany raises unit labor costs by 20 percent to 30 percent, that will lead to a massive increase in wages, the other countries will become more competitive and could hope for more exports to Germany. But the debt problem will not be resolved. That will happen if German wage-earners, who has so far maintained a degree of frugality consume, suddenly go wild. But that does not comply with the German mentality. Germany should not go that route.
But Europe sees it differently...
Normally, each person is oriented to the major service providers and trying to emulate the successful ones. The fact that Germany is now based to the back in the rankings, is an example of wrong thinking. A much weaker Germany would be a disaster for all of Europe as the continent fall in global competition and significantly reduces the general welfare.
How would you explain, that the Bundesbank suddenly states, that it would not be so bad if the inflation in Germany was slightly higher than in the rest of the euro zone?
These are political statements that are not really serious. The Bundesbank wants to be able to reject the allegations that are coming, if the Euro breaks. You can then claim that they had basically been open for some adjustments.
Will there be s parliamentary revolt against European Stability Mechanism (ESM)?
No, I do not think so. The SPD is also totally deluded. They understand the situation and carry only the euro as a dogma in front of them. And when Mrs. Merkel's party sat right next to the SPD, of course, the opposition was missing in the Bundestag. The FDP has some people who could do this. But this is still a very young team. They do not have that weight. This is a shame and not without its dangers. I assume that the ESM comes through in the Bundestag.
Are you as sure as President Joachim Gauck that the ESM is also before the Federal Constitutional Served?
Perhaps criticized the Constitutional Court of the ESM, if complaints were received. Basically, it is yet so that today the top management of large-scale industry, the high politics and the judiciary are high in league closely. We will arrange themselves. There is not very democratic decision. Although we call democracy, but democracy is in most industrialized countries in decline. And the voters feel that their interests will be ruled on by.
Gauck said that the parachutes would be accepted by the German population.
The majority of the population do not even know what it is. You may not understand the full complexity of the President and the consequences thereof.
To be continued...
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