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One Response to “New EU Reports: Current Account Surpluses; Fiscal Sustainability”
“Germany’s merchandise trade surplus vis-à-vis the
rest of the euro area increased significantly in the
years preceding the crisis, but it has almost halved
since 2007. The surplus vis-à-vis the rest of the
EU, which had increased very rapidly following
the 2004 enlargement, has also decreased in the
last few years. In contrast, the surplus vis-à-vis the
rest of the world had developed more moderately
before the crisis, but has increased significantly
since 2007 and represented around one-third of the
German surplus in 2011.
The UK for example is increasing its trade deficit with Germany
It appears to want to hook into the Rhine /Rhur region at the expense of the PIigs.
it has chosen real goods over income (see UKs current account second quarter)
This is a very big event.
meanwhile countries such as Spain is cut off from this capital flow and yet is unable to produce domestic currency to utilize its existing accumulated capital base to the greatest extent posssible….
Example people continue to use Euro capital tokens rather the Spanish money tokens.
Its as cheap to drive a car as get on a train.
Real capital (hard currency) is exported out of the country as the Euro or dollar oil balance does not move.
Instead the capital base both human and mechanical must be crushed.