The statistics behind the energy impact upon the German economy, the largest economy in the European Union, are almost unfathomable in scale. There is no way for the German industrial economy to continue with this level of price pressure. Stick a fork in the current creation of German industrial products and exports, the inflection point of feasibility for continued production has been crossed. They are done.
According to release statistics from the German economic ministry, energy prices in August were more than double the same period last year, up 139%. The monthly increase was more than 20.4% higher than July. Additionally, producer prices for electricity rose 174.9% compared with August 2021 and by 26.4% in a single month.
This jaw-dropping increase in energy cost has resulted in German manufacturing prices for industrial goods jumping 7.9% in August alone, with a year-over-year increase in the cost to manufacture goods at 45.8%. That is the highest rate of price increase since Germany began recording their statistics in 1939.
BERLIN, Sept 19 (Reuters) – German producer prices rose in August at their strongest rate since records began both in annual and monthly terms, driven mainly by soaring energy prices, raising the chances that headline inflation will surge even higher.
Producer prices of industrial products increased by 45.8% on the same month last year, the Federal Statistical Office reported on Tuesday. Compared to July 2022, prices rose 7.9%, it added.
The surge was considerably stronger than expected, with analysts having forecast a 37.1% year-on-year rise and a 1.6% monthly rise, according to a Reuters poll.
In July, the year-on-year increase had been 37.2% and in June 32.7%.
Energy prices in August on average were over double the same period last year, up 139%, and 20.4% higher than the previous month, the office reported. (read more)
Once again, my friends…. Pretending meets reality!
What does this mean in practical terms?
Firstly, it means the people within Germany and the larger EU will not be able to afford goods if the increased price to manufacture them is passed on to customers. German industrial goods, including the heavily dependent auto sector, will hit the market at double the price from last year. Exported goods, again assuming the government doesn’t provide some sort of subsidy to offset, would also double.
Secondly, it means the prices of used goods will increase in value. With imported vehicles holding that scale of increased manufacturing price, I would expect to see German automobile dealers in the U.S. sending out incentives to purchase used BMW’s, Audi’s and Mercedes for the products that are not produced in North America.
Lastly, on a global scale, Germany is dependent on selling industrial equipment to Asia and North America in the manufacturing sector. With declining demand for finished products -the result of inflation- there was already a lowered demand for machinery, machined tools and heavy equipment. Downward pressure due to a lack of demand, combined with upward price pressure to manufacture the industrial products, creates an even worse scenario.
Right now, Germany is on the cusp of a full-blown economic meltdown, and as we have seen recently German Minister of Economics Robert Habeck (pictured below) has no idea how to handle it.
Reminds me of the epilogue to the Pink Floyd song “Money.” Roger Waters is a helluva dude btw even through the drug years he’s leaps and bounds smarter and more articulate than most. Always loved that guy.
The sound is the printing presses cranking up and the politicians promising the plebes more money is on the way. Obviously it’s now 1’s and 0’s so it lacks the nice Cha Ching sound but it should still have the same effect. Mo money, mo problems….Lol.
“Money, it’s a hit.
Don’t give me that do goody good bullsh1t.”
What does Greta say the solution is.
They should continue to let her run the country.
You left the i out of “ruin the economy”
Germany is leveling the Black Forest for more worthless wind mills. Doubling down on stupidity, wave them a fond farewell.
Change the picture title from “The Pretenders” to “The Destructors”.
An article from The Saker I suggest is a real eye opener on the deindustrialization of Germany. As usual, I formation available nowhere else that I’ve seen.
https://thesaker.is/why-is-germany-committing-suicide-the-same-reasons-the-eu-uk-is-being-deindustrialized/
Ahhhhhh…that page “can’t be found”. After reading it I am not surprised, as the author advised reading before it was removed.
Posting below the link for The Sake with the author. It is easily found.
The Saker article by David Chu
“WHY is Germany committing suicide? The same reasons the EU/UK is being deindustrialized!”
https://thesaker.is/
So, we are to expect an influx of young Germans. Interesting quandary.
Well, half the world is being invited in…no shirt, no tie, but plenty of service. It depends on which “Germans”, I suppose.
Reminds me of this movie scene.
All the pretenders look absolutely awful in this photograph …for some magical reason they dropped the mask all at once for the pic. Geee… the wasted, the harpy, the clueless, the grifter, the cunning, the bagman. ..
“Up an inch” – Pedo Poopypants
Printer go brr brr brr.
Print Baby Print. Going to need a bigger printing press. More ink, quick.
People will soon start to understand what I’ve been saying for years… Debit is in fact, the new currency.
So Chiner craves German cars. They require German built machinery for manufacturing. China imports hog feed, food and Petrol.
China will buy less, and the ripple effect will lag and hit China almost as hard. China still has more coal generated electricity.
My business is contrarian and in contractions, my upside opportunities increase.
so you run a pawn shop?
There is going to be blood in the streets all over the world. I hope people have mentally prepared for that? If you don’t have secure doors and windows, now is a good time to do it, and it can be done cheaply. Home Depot currently do a Black Steel Fence Panel for $25 that can be adapted with a little thought. I already have razor wire shutters in my garage.
Jeez, where do you live?
I seem to recall a scene where Donald Trump was giving a speech at the UN about the folly of “green” energy and the camera caught the German delegation sitting there with smug, smirking, shiite-eating grins on their faces by way of saying “What? Me Worry?” Who’s laughing now, Hans?
The aftermath of Covid1984. The purpose of Covid1984 (the insane and utterly sinister mandated reaction to the virus) was to bring down the economy, primarily the US Trump economy in election year 2020.
Inflation, as the inevitable repercussion of the insanity, was easily predictable over two years ago.
How can the majority of people ignore the road to perdition paved by current world leaders?
Only one from USA saw it, President Trump, & they still fight like mad to silence him & MAGA.
You know you’re on the right path when toll-takers on the other road endlessly pursue you!
Europe is Bound To Collapse
https://www.theepochtimes.com/europe-is-bound-to-collapse_4721630.html?utm_source=Morningbrief&utm_campaign=mb-2022-09-11&utm_medium=email&est=cog59hnEjqVk4gP4fw7%2FFZl3UFvUArkM9TInASZBWGQoDykWcthwFW1K
I remember, quite clearly, how a POTUS just a few years ago warned the German of becoming reliant upon Russia for energy. He was ridiculed at the time by high level Germans.
Has any journalist gone back to these same folks?
Was there any consequence to them for this bad policy?
Curious minds want to know?
Achtung! Producer Prices in Germany Jump 7.9 Percent in August to 45.8 Percent, Highest Jump in Prices in History of German Economy
Making the Weirmar Republic look good! Quite a feat!
O How you reap what you sow…
Over a period of 16 years, Angela made a mess out of prosperity, and Olaf is stuck with it.
Play stupid games win equally stupid prizes.
“Oh dear, my little graph is upside down “!
But hey, at least their green energy is performing well.
Correct,
dummkopfs?
Lol
The inflation in the Weimar Republic, culminating in 1923, makes today’s rate look like chump change. The Weimar situation was the proximate launch pad for Hitler and his entire philosophy.
Enter Karl Schwab, stage left
Yes. But inflation always starts small.
anddddddd … ‘take two ‘ is on it’s way … mark my words this day … september 26 th 2022 …….
Hilarious to watch Germany destroy itself for once instead of the rest of the world. They deserve it.
Your a bit off on your cause effect. Germany destroys itself regularly, that’s the reason they go to war.
Wonder if those German scum bags masquerading as politicians are still laughing at Trump, who warned them that just what is now descending on their country was likely if they placed their trust in Putin and energy from Russia. It will be interesting to see if what happened in Sweden spreads across Europe.
not “IF” … but how soon … ( man are those ‘cultural enricher’s … in for a wake up call ……. )
Best new car I ever owned was a new Karman Ghia convertible I bought when I started college. worst peace of junk was a new Rabbit when they came out. With their inflation, it would save money if they sell cars imported from America.
Germany went ‘green’, now they pay that price. Other countries are following the same path – including the US. None of this has to happen – non of it.
Economic disaster?
They’re too busy chasing so-called ‘right-wing extremists’
That they themselves invent out of whole cloth
Report: German Intelligence Operates ‘Hundreds’ of Fake Right Wing Accounts
The Federal Office for the Protection of the Constitution (BfV), the leading domestic intelligence agency in Germany, operates “hundreds” of fake right wing accounts that it uses to infiltrate right wing political networks, according to a report by the German newspaper Süddeutsche Zeitung.
They can do as they traditionally do and take it out on a minority class… maybe muslims.
the muslims have earned their ‘ coming ‘ass kicking’ … no nation needs what they offer …….