Germany is the largest economy in the E.U. However, due to a confluence of horrible events, most of them self-created as an outcome of ridiculous energy production decisions, the German industrial economy has been contracting since 2022.
Into this downward spiral of negative economic events within Germany, now comes the problem of President Trump eager to eliminate the Marshal Plan of one-way tariffs and start dealing with the trade inequities. The German industrial manufacturing companies who make up the majority of the economic output are concerned, very concerned.
Within the discussion suddenly something appears that all Western financial pundits have yet to accept. Leo Barincou, a senior economist at Oxford Economics in Paris says:
[…] limited tariffs on selected products, such as cars, chemicals and agricultural products, may not be too much of a problem, Barincou says. A rising dollar, and hence a falling value of the euro, would offset some of the harm caused by the tariffs. “At a macro level, the impact would be limited,” he says. (read more)
Yep, here we go again.
We saw this play out in 2017 through 2019. China first responded to tariffs by subsidizing their targeted industries and later devaluing their currency. We began importing deflation because Chinese products arrived with lower, subsidized, prices, and we paid for them with higher value dollars.
The downside for the rest of the world was China pulling back from purchases of large industrial products from Europe. This made the EU furious at Trump, and subsequently the EU central banks lowered the euro as an offset. For Americans we started importing deflation from Asia and Europe. Everything was arriving at a lower price and being paid using higher value dollars.
I find it a little humorous that Germany openly admits they will offset Trump tariffs, devalue their currency, and ship goods without tax impacts. Meanwhile the gaslighting U.S. financial pundits will keep pretending this is not happening.
The names have changed, but the cause & effect outcomes remain the same.
Do not forget that EU Governments and “Economic Leaders” have exported GDP Impacting Manufacturing Know How and Licenses as well as jobs to BRICS members over the past 20 years.
The self inflicted wounds run very deep in the EU as the do in the US, when it comes to exporting GDP impacting know how and jobs with growth potential.
ALL while the BRICS nations and all G20 members, EXCEPT the US, furiously work to protect their domestic GDP related capabilities with taxes, legislation and tariffs. It is interesting to note that the politically motivated “fines” levied against all US Big tech and I/T Companies are part of the shake downs related to EU Economic issues.
Redressing this situation is focus of President Trump’s policies and regulation impacting efforts.
Do I care what they do with their own currency.
would you care if someone watered down your beer but charged you the same price?
There is no telling what they do to their beef before selling it in America. Our politicians fixed it to where we have no idea where our beef comes from.
Find a small, local farmer and buy grass fed beef from them, the meat is a 1000% better for you and tastes incredible, like meat is supposed to taste. Regenerative farming is growing across the country.
what would happen if they devalue their currency but then have to spend their own money on their own defense? IMHO and [very uneducated at that]. Continued military protection of NATO is a huge bargaining chip. Part of the reason they can play their b.s. games is that they don’t have to spend money defending themselves while USA protects them AND lets them suck us dry.
The “S” in BRICS stands for South Africa. Except for their world champion Springbok rugby team, South Africa’s economy, power supply and societal problems are a Shit Show.
True, seems South Africa is hoping to gain favorability with the other nations, who are the real power players. Can’t say I blame them, but their internal human rights and economic situation is dismal. Perhaps they bring some legitimacy to the table in the form of diversity.
Even with the defense of their country fronted by the US tax payer the Germans still can’t make a go of it.
If yove been watching, the euro has been devaluing for some time.
Media transparency is crucial. Without it, public trust erodes, misinformation spreads, and informed decision-making becomes challenging. Let’s demand honesty.
Now do tariffs on direct labor sold to the US as happens in IT shops and call centers.
Germany and the other Euros are hosed.
In Trump’s first term they attempted to balance-off Trump by cozying up to Russia using levers like the Nordstream pipeline deal. Now that they are in de facto war with Russia that trick won’t work anymore.
They are also in a trade-war with China over EV subsidies.
Europe has no big and powerful potential trade-partners left other than the USA.
Why is NATO still a thing, the Warsaw Pact is long gone.
Germany should never have sold their bitcoin. But with leaders like they have, one wouldn’t expect much from the Chris Coontz look-alike.
Each night I pray to God to Bless, Protect, Heal & Guide President Trump!
I’m now praying that my prayers are correct!