So what if Germany’s growth is based off of exports, their economy is growing! That’s what Germany does, it exports and they do a darn good job of it too if you ask me. The German economy has enjoyed a much higher rate of growth this last quarter than they hoped for, making America green with envy. The German unemployment rate already is better than it was before the recession on top of that.
So what are they doing right? – exporting to the right countries and the right people. Germany has done well in Asian and South American sales where the middle class is driving loads of consumers to buy. It’s good to know someone out there is spending! What will be the result? – I’m no economic expert by my guess is more spending on the ground in Germany and more domestic growth in turn for an even stronger economy.
What I like about the European way of business is that they are slowly growing, but sustainably growing, where as American business boom and bust in a matter of seconds it seems, which can be a good and bad thing. The Germans (and in turn much of the EU) are much more worried about keeping their economy sustainable rather than making it rich really quickly on riskier terms. Their history gives them the edge to worry more about welfare, the poor, healthcare, food shortages, etc and in turn they tend to go with policies that make more stable growth in their economy.
It’s amazing they are doing so well after the recession but to me, not surprising. The Euro, its existence which was questionable during the worst of the recession is proving it’s strong base,even as Greece tugs at the European economy.
Typically, a more stable economy means it will not bounce back as fast as places like America could, but in this case, Germany passed up the U.S. in recovery, an interesting economic point and I think it has to do with the culture of consumers. Germany has a recent history of being, what I would call, conservative with their spending. Citizens are not as materialistic and in turn don’t spend beyond their means as many Americans have, so Germany is having less issues on the back burner keeping them from recovering. They have more restrictions protecting them from personal financial turmoil too when it comes to lending.
On the other hand, the U.S. is plagued with more debt from greedy lenders, who knew people could not afford their offer, a housing crisis, and a group of citizens who are now more worried about paying off debts than spending, myself included. Three years of expensive American college has left me with a pile of loans, starting me a the bottom rung of ladder in paying off my debts as a young, working professional. I think I’m just happy to have a job I love in a country with such a high unemployment rate right now.
Like President Obama followed Germany in “Cash for Clunkers” (Yes, Germany had the idea and made it work first.) the American economy might take some exporting pointers into play from Germany as well.
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