Finance and Banking
“Cryptocurrency economists” need a broad range of skills Back in 1924, John Maynard Keynes postulated that a “master-economist must possess a rare combination of gifts. He must be mathematician, historian, statesman, philosopher – to some degree.” Numerous economists feel that this description is still valid today. And potentially disruptive technologies,Read More →
Benefits of the euro Up to now, the benefits of the euro have outweighed the drawbacks for Germany. However, in the event of a total breakdown of the eurozone, the current contingent liabilities arising from the ESM, ESFS, ECB government bond purchases and TARGET2 balances would materialise, forcing Germany toRead More →
Bad investments in East Germany Although bad investments in East Germany did not leave any macroeconomic turmoil in their wake they are firmly fixed in the memory of the German real estate sector. This experience may also explain the reluctance to invest and low levels of borrowing in the currentRead More →
broader Banking Union Implementing broader Banking Union remains a long term commitment Banking union does not appear in the chapter even though it forms a major pillar in efforts to make the EA more resilient. At the most recent EcoFin meeting, the German caretaker finance minister Peter Altmaier (CDU) adoptedRead More →
Underfunding of German companies There is no doubt that Germany’s considerable aversion to debt has far- reaching consequences. In particular, some critics point to the underfunding of German companies, an accusation that appears justified by international standards. However, more aggressive levels of borrowing by companies and households might only provideRead More →
Large banks continue to lose market share Remarkably, large banks continue to lose market share versus smaller competitors. Granted, total assets are not a particularly precise measure of bank size, yet they still provide useful insights: the top European banks’ balance sheet total was down again in 2017, by 4%Read More →
European banks The major European banks have seen their revenues stabilise in 2017, and through further cost-cutting and improvements in asset quality, their profitability rebounded strongly to the second-best figure in the past decade. However,banks continued to shrink, and both total assets and risk-weighted assets fell substantially. This helped capitalRead More →
Ruled by only eight chancellors For example, since 1949 early elections have been called just three times in Germany. The country has been ruled by only eight chancellors who have served for an average of more than eight years. There has been neither turmoil due to property bubbles nor privateRead More →
Germany has maintained a leading position Since becoming an industrialised nation 150 years ago, Germany has maintained a leading position among developed countries, despite suffering numerous massive setbacks (world wars, currency reforms) and challenges (reunification, migration). For more than half a century, output growth rates in Germany have been amongRead More →
Beacon of stability: The foundations of Germany’s success Chancellor Angela Merkel hit the nail on the head when she said that people in Germany “have never had it so good”. The country’s economic success is no fleeting episode, however. It is a phenomenon of the period since the Second WorldRead More →
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