German Mentality and Economy

[Armstrong]

Plans laid out by the Jewish writer Kaufman written to destroy Germany are being used against the rest of the Gentile world. Here's the classic:

Germany Must Perish

[Alex Linder]

I believe the origins of its successful business are many however two seem to stand out for me.

1. Germany's central bank (and its successor the EZB) have been relatively prudent with their monetary policy. French economic Richard Cantillon pointed out that with central banks printing money, this benefitted those who first received (i.e. those receiving the money prior to the inflation caused by its creation setting in) enormously.

In places like the United States and Britain, we have not seen prudent monetary policy. This has meant that the creation of dollars and pounds has been to enormous benefit to the few, in this case the investment banks and other financial services companies. Ridiculously large salaries (Goldman's chief received 800 million dollars in compensation in his best year to date) bears no relationship to the value (which is minimal despite what they tell you) that investment banks provide society. Their compensation is not market determined but driven by monetary policy (printing dollars). Add to this we now note that the risks of speculators like Goldman are subsidized and carried by the public taxpayer. It's an absurd system where the working class who makes things has to subsidize the elite oligarchy who do not.

What this means is that in the US and Britain the best and brightest are attracted towards degrees in business administration and finance as their ticket to investment banking whilst in Germany or Japan, the brightest are attracted towards engineering and the physical sciences - i.e. the people who make things.

German speaking countries (Austria and Switzerland although smaller also make great stuff) do not experience the internal brain drain of the bright towards the unproductive or indeed, as we've recently witnessed, destructive activities of a financial services industry that is not driven by market forces (i.e. what the public needs and wants) but by government policy.

2. Many of Germany's companies are not publicly owned and many of the publicly listed companies are under the control of families. Families tend to take a long-term, conservative, investment oriented, technologically innovative approach towards their businesses, after all they are going to pass these companies along to the next generation. In the UK and the US, not so much. Instead, companies are owned by short-term owners, hence the absurd focus in the US on things like annual, half-yearly and absurdly quarterly earnings. CEOs are all focussed on their share price as though it was some measure of success when indeed it is not. The love of debt amongst listed companies is linked to this myopism. The democratization of corporations has led to the same short-term focus that it has taken in politics.

http://www.economist.com/node/18061718/comments

[Alex Linder]

The German Health Care System

By John Goodman Filed under Health Insurance on June 4, 2010 with 13 comments

The Rhetoric: German health officials and health policy analysts believe the two best features of their health care system are (a) solidarity and (b) income-based (progressive) premiums.

The Reality: (a) 10% of Germans opt out of national health insurance and enroll in private plans and (b) 80% of those in private plans are civil servants and their premiums are paid for by government (taxpayers).

Effect on Doctors: In the general system, primary care physicians operate with as many as 100 separate quarterly budgets for the services they provide; when they hit a budget ceiling, they stop providing the service until the next quarter.

Effect on Patients: Ordinary Germans are traveling to other countries (even the UK!) to get services they cannot get promptly in Germany.

http://healthblog.ncpa.org/the-germa...h-care-system/

[Alex Linder]

Showing Germany/Germans are still too naive, too willing to take at face value, too gullible, too uncomprehending of the actual nature of other countries, too trusting of seemingly objective standards that could serve as cover for frauds and scams...

http://www.hewinsfinancial.com/blog/...-but-verify-2/

[Alex Linder]

When the economic and financial history of this period is written in the fullness of time, Germany will likely be mentioned often for its large and important role for all that has and has still yet to occur. It will be a history of great wonder and of contradictions. The German economy and the financial habits of its citizenry provide a model of prudent saving and sound investment. The population is famously cautious and risk-averse. Leading up to the 2008 Financial Crisis, there was no great real estate boom in Germany. The practice of borrowing to fuel consumer spending is just not a part of the culture. Thanks to these good habits the German citizenry is in a position to consider bailing out the weaker EU nations as well as the European banks.

Yet many German financial institutions provided the fuel that drove the lending binge across Europe and the United States. They financed the frenzy in places like Ireland and Iceland and were large buyers of U.S. subprime mortgages. In those places alone it is estimated that German banks have lost over $180 billion. German bankers were not financially incented to make big, risky bets like their counterparts at U.S. investment banks were. Their salaries and bonuses were relatively modest. So why did they make big bets that in retrospect look quite reckless?

We can speculate on the impact of typical German mentality and behavior on these bankers as they made these decisions, but suffice it to say that the ability of Wall Street to make packages of risky assets look riskless proved to be remarkably successful in Germany – a place where trustworthiness and rules count for a great deal. If a U.S. investment bank could create a security that earned very high credit ratings and conformed (at least on the surface) to a number of criteria on a checklist, it found the German investment sector to be a great market in which to sell its wares.

Likewise, being trustworthy and rules-oriented allowed Germans to go along with the grand designs that cobbled together the European Union and the Euro. The Achilles’ heel of these noble German qualities of trustworthiness and the honoring of rules is that, sadly, others may prove to be less trustworthy. When the Germans agreed to the single currency, they demanded a rule in the charter of the European Central Bank that they would never have to bail out another member country. That rule was violated last year to help Greece, and many Germans have been quite upset since. The Germans demanded that all the member countries that adopted the Euro conform to strict rules regarding budget deficits. Never could they imagine that the Greek government would fabricate its budget statistics.

[Alex Linder]

When the economic and financial history of this period is written in the fullness of time, Germany will likely be mentioned often for its large and important role for all that has and has still yet to occur. It will be a history of great wonder and of contradictions. The German economy and the financial habits of its citizenry provide a model of prudent saving and sound investment. The population is famously cautious and risk-averse. Leading up to the 2008 Financial Crisis, there was no great real estate boom in Germany. The practice of borrowing to fuel consumer spending is just not a part of the culture. Thanks to these good habits the German citizenry is in a position to consider bailing out the weaker EU nations as well as the European banks.

Yet many German financial institutions provided the fuel that drove the lending binge across Europe and the United States. They financed the frenzy in places like Ireland and Iceland and were large buyers of U.S. subprime mortgages. In those places alone it is estimated that German banks have lost over $180 billion. German bankers were not financially incented to make big, risky bets like their counterparts at U.S. investment banks were. Their salaries and bonuses were relatively modest. So why did they make big bets that in retrospect look quite reckless?

We can speculate on the impact of typical German mentality and behavior on these bankers as they made these decisions, but suffice it to say that the ability of Wall Street to make packages of risky assets look riskless proved to be remarkably successful in Germany – a place where trustworthiness and rules count for a great deal. If a U.S. investment bank could create a security that earned very high credit ratings and conformed (at least on the surface) to a number of criteria on a checklist, it found the German investment sector to be a great market in which to sell its wares.

Likewise, being trustworthy and rules-oriented allowed Germans to go along with the grand designs that cobbled together the European Union and the Euro. The Achilles’ heel of these noble German qualities of trustworthiness and the honoring of rules is that, sadly, others may prove to be less trustworthy. When the Germans agreed to the single currency, they demanded a rule in the charter of the European Central Bank that they would never have to bail out another member country. That rule was violated last year to help Greece, and many Germans have been quite upset since. The Germans demanded that all the member countries that adopted the Euro conform to strict rules regarding budget deficits. Never could they imagine that the Greek government would fabricate its budget statistics.

[Alex Linder]

What's the difference in mentality between a German and an Australian?

This is an interesting question because both countries are located extremely far away from each other, Germany is in the Northern Hemisphere and Australia in the Southern Hemisphere. Both countries are very different in many aspects and so you could ask if there is also a difference in thinking between Germans and Australians.

Well, I tell you a little story and make it quite clear using a real-life example.

The Teachers

Joe was a teacher from Australia who was working at a German school for some time to gain experience and to improve his German.

It was winter and the snow was hanging in the trees. The Australian teacher had a break and was going to have his lunch. He entered the teachers rest room and sat down on a chair to relax.

It was a nice day and everything was fine. Suddenly the door opened and another teacher, a real German, came in.
"I am teacher Hampel", he said to Joe.
"Nice to meet you", said Joe.
"Well, Why don't you get up?" the German asked.
"Why that?" Joe asked.
"Because this is my chair", the german teacher answered.
"But there are a lot of other chairs around", said Joe wondering about all this senseless talk.
And then came an incredible statement:
"I have sat on this chair since twenty years and so this is my chair!"

And then came an incredible answer:
"Get lost, or I cut your balls off!"

Do you understand now the difference in mentality between a German and an Australian?

http://ezinearticles.com/?Difference...ian&id=5777154

[Alex Linder]

But when Damon and wife Sabrina Bochen journeyed to Germany to find previously unexported wines for their new retail/import/ distributor operation, they discovered that the forward thinking went only so far forward. "I said to them, 'We want to be an extension of who you are in the U.S.' We will always be specialists in German wines; we like the idea of carving out a microniche for ourselves and getting really good at it. I've always had that sort of brand mentality" -- perhaps the fruit of running a franchise restaurant company with his brother for four years. But, he found, "These guys don't market or brand. They just don't really believe in it." Decades of negative fallout from Blue Nun and Liebfraümilch would probably be enough to account for that, but there's also the matter of tradition. "They're very German -- their whole mentality is, 'We've been here for 600 years. We sell out of our cellars, and we sell out every year. Why do we need to sell to the U.S.?' For most of the estates, it was the flatter-factor that interested them. They were so flattered by the fact that some couple from the U.S. would come over to meet them, try their wines, and bring them over here."

Even so, they hesitated when they heard what Damon was after. "They'll sell 50--70,000 bottles a year out of their cellar, but they'll hand sell it, with the average customer buying a case. People have been coming for 30 years. That's how they do business, and here I was, showing up and saying, 'We'll be taking two pallets. I need 50 cases of this, 20 of that.' They were blown away."

On top of that, this eager American was asking for exclusivity. "That was a big step for a lot of these guys. When they do business in Germany, it's a handshake. But my goal is to get these wines reviewed, and I'd like to reap the reward of doing the work. If they sell them to every other importer in the U.S., where does that leave me?" Particularly if another, larger importer decides to eliminate the competition by scooping up everything available for the U.S. market.

http://www.sandiegoreader.com/news/2...ity-weve-been/

[Alex Linder]

Germans have a hard time bending the rules. Way too stubborn.(My mom was half German so lived it)


Americans are much more casual in their outlook.

I remember when we drove through Germany with our 12 year old son. We wanted to get a room to sleep overnight, the hotel manager MADE us get two rooms because the rules said two people per room.

That was plain insane, we were too tired to make a fuss but changed our travel plans after that.

[Swede]

Sometimes I think you have Asperger syndrome Alex. You see everything so black and white

[Alex Linder]

Originally Posted by Swede

Sometimes I think you have Asperger syndrome Alex. You see everything so black and white

Are you referring to something specifically? These above were nuggets I found when searching 'German mentality.' Some things are black and white, some aren't. It's important to know the difference and neither undersimplify, as intelligent people do, nor oversimply, as dumb people tend to do.

[Rounder]

A large pregnant blonde German gal, and a skinny pregnant brunette French gal waiting to see the doctor.

French gal: "I'm having the Le Maze method. What method are you having?

German gal: "The German method."

French gal: "Oh yeah, what's that mean" ?

German gal: "That means going in there and getting the damn thing over with."

[Mike Parker]

Originally Posted by Alex Linder

Many of Germany's companies are not publicly owned and many of the publicly listed companies are under the control of families. Families tend to take a long-term, conservative, investment oriented, technologically innovative approach towards their businesses, after all they are going to pass these companies along to the next generation.

It's long been alleged that closely-held German firms manage for market share, which is to say they're sadly unenlightened by modern finance theory. I'd like to know how the Germans finance sizable family manufacturing enterprises. The article below talks about "self-financing" and bank financing. The former, retained earnings, begs the question (oops) of how much they're earning. The latter is very difficult in the US, factories being dubious collateral compared with hotels or retail inventories. Does Germany's far more concentrated banking sector facilitate real "relationship banking," which is only an ad slogan here?

The German Miracle Keeps Running: How Germany’s Hidden Champions Stay Ahead in the Global Economy

Lessons from Simon’s analysis of Hidden Champions

1. Hidden Champions strive for world market leadership to become No. 1 in the world in their markets/segments.
2. Market definition is an important part of strategy development, usually leading to narrowly defined markets, both from a customer and technology perspective and a highly focused strategy.
3. Specialization in product and know-how is combined with global selling and marketing.
They serve the target markets through their own subsidiaries and do not delegate the customer relationship to third parties.
4. Hidden champions are very close to their customers in particular to their top customers.
They are value, not price oriented.
5. They are highly innovative in both products and process, not only confined to technology. Innovation activities are globally oriented and continuous.
6. The overall company orientation is not one-sided but both technology and market driven.
7. Hidden champions create competitive advantages in product quality and service. They are close to their top competitors and defend their position ferociously.
8. They rely on their own strengths. They mistrust strategic alliances and outsource less than other companies. Their value chains are deep. They see the foundation of their competitive superiority in things which only they can do. Together with lesson 2 their strategies could be defined as “deep rather than wide”: Deep in their value chain, not wide in their coverage of different markets with different needs.
9. Hidden Champions have very strong corporate cultures associated with excellent employee identification and motivation. Selection for jobs is sharp.
10. Their leaders are very strong and stay at the helm for decades.

Their raison d´être is thus not only to maximize profits but to secure the company’s existence for the next generations. Firms are designed to stay independent and to achieve multigenerational continuity.

In addition, Mewes advised companies to shift their objectives from profit maximization to maximize their “power of attraction” for their target group. Profit is not the objective, but rather the result of these efforts.

[Rick Ronsavelle]

It's always government. Look first and last there. Never has there been more statism- yet this era is called "liberal". There is enough buying and selling under corporatism (fascism) that it palms itself off as "capitalism".

As A. J. Nock showed, ALL governments were and are established for only one reason- economic exploitation.

Mankind has only one problem- stopping the special interests from taking over the government.

I presume Germany is just as cartelized as the 'Kwa. The "enabling act" here was the Swope Act of 1935, from GE CEO jew Gerard Swope. This formed the big three auto makers, who embraced the UAW, and all stuck it to the consumer. The Swope act took care of Preston Tucker. . .



Jason A. Gorn

German banking is distinguished from neighboring European banking systems by the influence of its public sector banks. Nearly 50% of German banking is carried out by government owned state banks (ländesbanken) and regional savings banks (sparkassen) whose roots date from the 18 th century. German banks play a particularly important role in the economy and exert more control over firms and corporations than do their American counterparts. German banks tend to be less profitable than foreign
counterparts. German public banks were originally founded to foster local and regional business. However, the operations of German public sector banks now extend into all forms of international investment. German public banks are currently seeking new business models to increase profits as they are being forced to compete in the global financial market under liberal market practices dictated by the European Union. Turbulence in the global financial market precipitated by the U.S. sub‐prime mortgage meltdown has severely impacted German public sector banks, precipitating a banking crisis that leaves German taxpayers exposed to staggering losses. These global financial pressures dictate the restructuring of the German financial system. This restructuring has forced a breaking point in the traditional German corporatist banking model and is associated with significant risks to the stability of the German banking system.

http://scholarship.claremont.edu/cgi...=pitzer_theses

The EU motherfuckers are DICTATING LIBERAL MARKET PRACTICES.

Lots of folks need a severe bitch-slapping. Under real liberalism these State-owned banks would not exist. . .

[Alex Linder]

Krugman: Germany Needs a Bubble To Save the Euro
Posted by Bill Anderson on July 30, 2012 08:24 AM

Remember when Paul Krugman called for Alan Greenspan to create a housing bubble to replace the collapsed NASDAQ bubble? While he has since backtracked from that and last year said that the U.S. Government effectively can fight this depression by preparing to fight off an invasion by imaginary "space aliens," he has a new plan to save the euro: create a bubble in Germany. He writes in response to the current troubles of Europe:

What could turn this dangerous situation around? The answer is fairly clear: policy makers would have to (a) do something to bring southern Europe’s borrowing costs down and (b) give Europe’s debtors the same kind of opportunity to export their way out of trouble that Germany received during the good years — that is, create a boom in Germany that mirrors the boom in southern Europe between 1999 and 2007. (And yes, that would mean a temporary rise in German inflation.)

Never mind that the boom was based upon an unsustainable bubble. In effect, he is demanding yet more bubbles and when they collapse, he will blame private enterprise, as he always does. I deal with his statements here.

http://www.lewrockwell.com/blog/lewr...es/116810.html

[Hunter Morrow]

Almost everybody always wants the get-rich-quick scheme and the bubble. The problem with bubbles is twofold. One, by its very nature a bubble is a malinvestment. Time, money and effort is put towards the bubble when it would be better saved or put elsewhere. Secondly, bubbles pop.

I don't see how somebody could have seen American households lose 40 percent of their value in the past 5 years and go...GERMANY NEEDS THAT, TOO!

The German's conservative FUCK DEBT mentality that values hard and honest work left them to be in a position to bail everybody out. They are now the well off relative that all the shithead, fuckup relatives pester for food, housing and money. The absolute last thing Germany needs is a bubble. That is the stupidest notion I've heard all month.

[Alex Linder]

Guardian comparison of bankers, London vs Frankfurt
http://www.guardian.co.uk/world/blog...here-lads-gone