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Posts tagged ‘Chancellor Angela Merkel’

End of the Wirtschaftswunder? Germany’s sudden slowdown

 

By Noah Barkin

The German soccer team’s romp to victory in last month’s World Cup was hailed at home as a symbol of the country’s emergence as a confident global economic power.

 

But in an ironic twist, the feel-good triumph in Brazil may have come at a time when Germany’s new “Wirtschaftswunder”, or economic miracle, is coming to an end.

 

In recent weeks, the economy that proud German politicians have taken to describing as a “growth locomotive” and “stability anchor” for Europe, has been hit by a barrage of bad news that has surprised even the most ardent Germany skeptics.

 

The big shocker came on Thursday, when the Federal Statistics Office revealed that gross domestic product (GDP) had contracted by 0.2 percent in the second quarter.

 

“The euphoria that we’ve seen, the perception that the German economy is booming is simply misplaced,” said Marcel Fratzscher, director of the DIW economic institute in Berlin.

 

So why is Germany suddenly ailing?

 

The standoff with Russia over Ukraine has received its fair share of blame in the German media. But that conflict may not hit the economy with full force until the third quarter. It was only last month that Europe stung Moscow with economic sanctions, prompting a tit-for-tat response from Russian President Vladimir Putin.

 

In reality, economists and some government officials acknowledge, there are deeper reasons for the recent downturn. And they have little to do with the spike in geopolitical tensions in eastern Europe or the Middle East.

 

They start at home, where Chancellor Angela Merkel’s abrupt exit from nuclear energy after the Fukushima disaster in Japan and aggressive push into renewables has unnerved German industry. A recent overhaul of the country’s complex renewable energy law has done little to alleviate uncertainty over future policy or assuage fears about German energy competitiveness.

full article HERE

 

Putin Tells Merkel “Ukraine On The Verge Of A Civil War” As Germany Agrees To Re-Sell Russian Gas To Ukraine

A day after Putin called Obama to warn him that only the US president can prevent bloodshed in Ukraine – something which Obama failed at based on this morning’s reports out of east Ukraine – German Chancellor Angela Merkel had a follow up phone call with the Kremlin a few hours ago, in which Putin told her that “The sharp escalation of the conflict puts the country, in essence, on the verge of a civil war”.

From Itar-Tass:

 President Vladimir Putin has had a telephone conversation with Chancellor Angela Merkel of the Federal Republic of Germany and discussed with her the situation in Ukraine, the Kremlin press service reports.

Russia’s Head of State pointed out , “The sharp escalation of the conflict puts the country, in essence, on the verge of a civil war“.

The leaders of the two countries accentuated the importance of talks in a quadripartite format (Russia, the European Union, the United States, and Ukraine), planned for April 17. “Hope has been expressed that the sides at the meeting in Geneva will manage to convey a clear message contributing to directing the situation into a peaceful channel,” a Kremlin press service official added.

The RF President also recalled the importance of stabilizing the economy of Ukraine and of ensuring deliveries and transit of Russian natural gas to Europe. This had been reiterated in his message, dated April 10, 2014, to the leaders of a number of European countries.

The telephone conversation was held on the initiative of the German side.

Considering the events from this morning which nearly resulted in the S&P plunging below 1800 only to be “redeemed” by the “bad news” that the Japanese economy is about to stumble yet again, leading algos to believe that more BOJ QE is imminent and sending the S&P surging by over 30 points in the span of a few hours, this is hardly surprising.

What is more surprising, is that as we reported earlier, the very same Germany, through its RWE AG utility, announced it would supply Ukraine with nat gas in 2014 since Gazprom is adamant on no longer providing the troubled country with the precious commodity in the absence of payment (which Ukraine can’t afford). WSJ reports:

 German utility RWE AG said it agreed to supply Ukraine with natural gas this year, as the troubled country seeks to reduce its reliance on gas imported from Russia.

RWE is the first European energy company to agree to supply gas to Ukraine since the political crisis there threatened the former Soviet republic’s supplies from Russia. But the deal underscores the extent to which Europe, now scrambling to shore up Ukraine, also depends on Russian gas…………………

full article at source: http://www.zerohedge.com/news/2014-04-15/putin-tells-merkel-ukraine-verge-civil-war

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