This blog entry from the Wall Street Journal's website begins with the author pointing out the numerous differences between economists in forecasting growth for Europe. It seems that with so many different authorities saying different things and citing different statistics, macroeconomics can be quite a confusing subject. For the most part, however, economists and finance ministers should be cautious and not too optimistic when forecasting the financial health of Europe. The article then addresses a lot of the economic success Germany has experienced when compared to other eurozone countries, maintaining its position as "Europe's growth engine." The rest of the countries in the European Union are experiencing a variety of increases and decreases in economic indicators, making it hard to judge exactly how the continent is doing as a whole. Countries like Germany have been reliable leaders during the course of the Great Recession, but it remains to be seen how nations like Greece and Portugal will deal with a slow recovery.
I believe that Germany's knowledge in the fields of science and technology have allowed them to gain an upper-hand in the battle for economic superpower of Europe. Their automobile industry contributes a lot to the cause.
ReplyDeleteThis reminds me of Fareed Zakaria's GPS podcast in CNN.com, in which he talked about why or how the German economy is booming even during the times of recession. Germany has a strong manufacturing sector, and unlike U.S, it does not outsource its manufacturing. Also, while many of the U.S companies were shedding off jobs, the German companies had employees working for half time or even quarter time, and in return retaining its worker's skills and loyalty. In July, Germany‘s unemployment rate fell for the 13th straight month, and has almost regained all of the jobs that it lost during the recession.
ReplyDeleteI have pasted the link to the podcast if anyone is interested to see it, and he starts talking about Germany after the 18th minute.
http://www.cnn.com/video/#/video/podcasts/fareedzakaria/site/2010/08/22/gps.podcast.08.22.cnn