Germany makes a €380million profit from Greece's struggling economy

[Turkophagos]

http://www.joe.ie/uploads/story/21913/21913-xlarge.jpg


Is anyone else curious as to why Germany is still so rich? Well, the answer is because they’re absolutely cleaning up on interest when it comes to bailout loans. Nice. That Angela Merkel is a savvy one, isn’t she?

Greek news website Athens News reports that Germany has earned at least €380million from the economic struggles currently happening in Greece. Where is all this money coming from and why isn’t it being pumped to Greece, the one place where it is desperately needed?

Well the money is coming from the interest Germany is earning on the loans it paid to Greece under the first bailout for the company – this is according to official documents from the German finance ministry which have been obtained by Reuters.

Apparently Berlin’s contribution to the first bailout package for Greece in 2010 amounted to a massive €15.1billion. On this lump sum, the Greek Government had to pay interest that ranged between 3.42 and 4.52 per cent. Steep considering the situation in Greece at the time (and definitely the situation that is on-going in the country today).

At the end of 2011, Germany had smugly earned at least €380million on the initial loans to Greece. Nice. Now that’s a shrewd investment.

It is believed that while news of this windfall may make a lot of Greeks incredibly angry at Germany, it will quell some of the public frustration about having to help Greece in Germany.

Apparently some members of the German public, and German Government (Wolfgang Schaebule, we’re looking at you) are of the view that Greece is just a “bottomless pit” that will continue to hemmoraghe their hard-earned cash.

If Germany is making that much money off Greece’s struggling economy, we’d hate to see just how much they’re making off us…





http://www.joe.ie/news-politics/world-affairs/germany-makes-a-e380million-profit-from-greeces-struggling-economy-0021913-1

[Romanion]

Stop paying them interest, end of story. If they don't like it don't pay anything back at all.

[2Cool]

Germany will pay the price for their actions. Their doing good now due to their exports in the EU, but their exports will diminish as the economy in many European countries get worse.

[Geminus]

You know that the public opinion about Greece in Germany is that it's pretty much a bottomless hole where German taxes are put into? Just to let you know the other side...:)
There will be a debt cut for Greece (I think it is already decided), so what does Germany get out of this Greek crisis...?

[Horseman]

Greece one way or another will come out from the euro zone. Then will be getting the right value of the Greek currency. And it will not have anything to do with Germany.

[Contra Mundum]

Germany will pay the price for their actions. Their doing good now due to their exports in the EU, but their exports will diminish as the economy in many European countries get worse.

The American economy is strong compared to Europe's and Americans love German cars, so do the Russians, Japanese and Chinese. I think Greece needs Germany more than Germany needs them.

It's pathetic that the Greeks are blaming their problems on the Germans.

[Romanion]

so what does Germany get out of this Greek crisis...?

Appearently, a large profit.

[Romanion]

It's pathetic that the Greeks are blaming their problems on the Germans.

Blaming the crisis on teh German? no, blaming the interests, yes. If this was a "bail out", there wouldn't be interest rates. This is a loan, and Greece shouldn't pay back any interest at all.

[poiuytrewq0987]

Blaming the crisis on teh German? no, blaming the interests, yes. If this was a "bail out", there wouldn't be interest rates. This is a loan, and Greece shouldn't pay back any interest at all.

Why should Germany give interest-free loans to a uncreditworthy state on the brink of default? :confused: It'd be like giving people on welfare loans even though they can't really pay it back without dedicating 50% of their monthly income on loan repayment...

You repay loans with interest, you get to stay in the eurozone, and rebuild credit and balance your budget at the same time. I don't see anything wrong with that.

[dralos]

werent they going to cut in half this debt and mayby forget all about it,so i dont think germany is all that bad for greece

[Contra Mundum]

The Germans have given away so much money, it's amazing they have any left. The money they gave the Russians, the Jews and money paid to get eastern Germany up and running. They also give a lot in foreign aid.

[Romanion]

Why should Germany give interest-free loans to a uncreditworthy state on the brink of default? :confused: It'd be like giving people on welfare loans even though they can't really pay it back without dedicating 50% of their monthly income on loan repayment...

You repay loans with interest, you get to stay in the eurozone, and rebuild credit and balance your budget at the same time. I don't see anything wrong with that.

They should give interest free loans because if Greece can't pay back its debt and defaults, the same will happen to the other PIGS. There will be a renigotiating of the debt again in the future.

[Romanion]

The Germans have given away so much money, it's amazing they have any left. The money they gave the Russians, the Jews and money paid to get eastern Germany up and running. They also give a lot in foreign aid.

Someone needs to learn about economics.

[poiuytrewq0987]

They should give interest free loans because if Greece can't pay back its debt and defaults, the same will happen to the other PIGS. There will be a renigotiating of the debt again in the future.

Greece has money to repay its loans. The ones who are really affected are government pensioners and state employees who lived on inflated wages and earn and spend mentality.

[Queen B]

Greece has money to repay its loans. The ones who are really affected are government pensioners and state employees who lived on inflated wages and earn and spend mentality.
Τhe ones that are really affected are all except those you mentioned.

An university degree person, which is less than 25y.o used to get 700 euro as first salary. Now its 470, with the same (if not higher) expenses.
Only the rent is - at least - 380 (not even mentioning bills like water/electricity)

My father got a -50% off his salary, he works the last 33 years and he is a heart transplant patient (yes, he still works )

[Romanion]

Greece has money to repay its loans. The ones who are really affected are government pensioners and state employees who lived on inflated wages and earn and spend mentality.

" It also looks at intra-eurozone balance sheet exposures to shed light on channels of contagion and the main financial implications of the scenarios, as well as the potential magnitudes of exchange rate adjustments. The scenarios in order of likelihood are: "Greek Exit", "Quasi-Fiscal Union", "Euro-mark" (Germany and a 'core' exit, leaving the remaining countries with the euro); "United States of Europe" and "Full Break Up". "

http://www.reuters.com/article/2012/05/03/idUSWNA646620120503

[poiuytrewq0987]

Τhe ones that are really affected are all except those you mentioned.

An university degree person, which is less than 25y.o used to get 700 euro as first salary. Now its 470, with the same (if not higher) expenses.
Only the rent is - at least - 380 (not even mentioning bills like water/electricity)

My father got a -50% off his salary, he works the last 33 years and he is a heart transplant patient (yes, he still works )

I don't really see how the government debt crisis can majorly affect the salaries of private sector employees. Public and private sectors are totally unrelated sectors because public sector employees rely on the well-being of the govt's bottom-line for their wages. The private sector relies on the demand of the market for their wages. Only two possible scenarios and one is the halting of government private sector subsidies or the other the wages are finally lowering to match Greek productivity level. The next step is the lowering of living costs to match the new wages and this can take some time...

[poiuytrewq0987]

" It also looks at intra-eurozone balance sheet exposures to shed light on channels of contagion and the main financial implications of the scenarios, as well as the potential magnitudes of exchange rate adjustments. The scenarios in order of likelihood are: "Greek Exit", "Quasi-Fiscal Union", "Euro-mark" (Germany and a 'core' exit, leaving the remaining countries with the euro); "United States of Europe" and "Full Break Up". "

http://www.reuters.com/article/2012/05/03/idUSWNA646620120503

Let's not kid ourselves. The Eurozone is not going to break up because of Greece.

[Queen B]

I don't really see how the government debt crisis can majorly affect the salaries of private sector employees. Public and private sectors are totally unrelated sectors because public sector employees rely on the well-being of the govt's bottom-line for their wages.
Unfortunately it happens, and this is one of the questions I have my self.
This didn't happen in the start of the crisis, but Troika suggest it that, as well as other measures against private sector.
Its tottaly wrong because 1) this favors the business owners , the ''few'', and not average people and 2) with less money to people, there will be no circulation of money in the market, that's why there is no growth, no matter the cuts.


The private sector relies on the demand of the market for their wages. Only two possible scenarios and one is the halting of government private sector subsidies or the other the wages are finally lowering to match Greek productivity level. The next step is the lowering of living costs to match the new wages and this can take some time...
Unfortunately, living cost haven't changed. Its still the same, if not bigger.

[Icosahedron]

It's only a profit when you've recouped your original investment.

[Geminus]

It seems that the profit like almost always goes to the few rich ones. In Greece there is a lot of corruption and from what I know there somehow are 2 big political "families" which let rule each other for a while.
Greece has to deal with it's corruption and it's somewhat inefficient governance system and especially it's financial department.
Of course nobody denies people the right to get salaries they can live off.

[Albion]

Germany has to put on interest because by the time Greece pays it back it'll be worth a lot less (that is unless the world goes zero growth over night anyway).
Also Germany has a certain amount of risk involved and has to take this from its own economy - its tax payers are footing the bill.

Germany shouldn't make too much from it, but by the time Greece pays the money back Germany will be lucky if it's worth half of what it is now.

[Loki]

Germany will pay the price for their actions. Their doing good now due to their exports in the EU, but their exports will diminish as the economy in many European countries get worse.

Their actions? They were the ones who rescued Greece.

[Queen B]

Their actions? They were the ones who rescued Greece.
Yeah sure :lol00002:

We have a saying here that says '' First you shit on us and then you wipe us?''

[Aces High]

Is anyone else curious as to why Germany is still so rich?

Because they have a mega work ethic and strive for excellence in whatever they do.
Walk around Hamburg like i once did and understand that the place a few decades ago resembled a lunar landscape.
Just sit there and look at the buildings built up from scratch and look at the healthy wealthy people walking about.
Hard work and Germanic thoroughness.

Good luck to them.:food-smiley-004:

[Albion]

Their actions? They were the ones who rescued Greece.

Yes, after pouring in money along with other Europeans, so much so that it would become impossible for Greece to ever pay it back in time.
The two leading nations of the Eurozone - Germany and France failed to keep an eye on things and sent a lot of money east and south to grow their own economies via trade with the suddenly prosperous countries in southern and eastern Europe.

[Albion]

Because they have a mega work ethic and strive for excellence in whatever they do.
Walk around Hamburg like i once did and understand that the place a few decades ago resembled a lunar landscape.
Just sit there and look at the buildings built up from scratch and look at the healthy wealthy people walking about.
Hard work and Germanic thoroughness.

Good luck to them.:food-smiley-004:

And because America wrote off a lot of their debts whilst the rest of Europe kept paying...
Germany's debts were the biggest because Germany was most devastated by war.

[poiuytrewq0987]

And because America wrote off a lot of their debts whilst the rest of Europe kept paying...
Germany's debts were the biggest because Germany was most devastated by war.

I think Germany only recently paid off its WW1 debt...


Few people in Germany noted the country's final $94 million WWI reparations payment on Sunday. Some historians say that's for the best.

http://www.csmonitor.com/World/Europe/2010/1004/Germany-finishes-paying-WWI-reparations-ending-century-of-guilt

[supergiovane]

Germany benefited from the single euro currency, its economy is made mostly by exports and they don't have to face the competition of lower currencies like greece's anymore. :eek:

[Aces High]

Germany benefited from the single euro currency, its economy is made mostly by exports and they don't have to face the competition of lower currencies like greece's anymore. :eek:

Of course they have to face competition.

I could go out and buy a ford focus or fiat that costs much less than a VW or Merc or BMW or AUDI but i will go for the German car even though it costs more.....why..?
Quality thats why.....the Germans produce quality and are a byword for it.

People should stop knocking them out of petty jealousy and start to imitate them and then maybe their fucked up countries will be as streamlined and advanced as they are.

[Geminus]

I think Germany only recently paid off its WW1 debt...

You see we've been paying and paying to everyone... We were destroyed after the war, even then the Allies deprived us of food support and after the war the dying continued. Then still we built up again and now are the strongest economy in Europe again. Even if the future looks sombre we must remember what we achieved in days worse than now.

[Albion]

Of course they have to face competition.

I could go out and buy a ford focus or fiat that costs much less than a VW or Merc or BMW or AUDI but i will go for the German car even though it costs more.....why..?
Quality thats why.....the Germans produce quality and are a byword for it.

People should stop knocking them out of petty jealousy and start to imitate them and then maybe their fucked up countries will be as streamlined and advanced as they are.

I've got a German boiler and set top box. Both are shit and required my engineering genius to fix them on the many times they broke down.

The whole stereotypes about German products being quality and Chinese ones being crap is just a generalisation. There's truth in it of course but don't take it as the bible.

[Albion]

I think Germany only recently paid off its WW1 debt...

Yes after the reparations were brought down to a nominal figure (compared to what they would have otherwise been) and frozen until German reunification.
Upon reunification there were even years where it didn't pay and so technically defaulted upon them.

The rest of Europe meanwhile had to pay back the cost of war and rebuilding funds. The war didn't just stunt the European economies, it sent many into a long decline.

[poiuytrewq0987]

Yes after the reparations were brought down to a nominal figure (compared to what they would have otherwise been) and frozen until German reunification.
Upon reunification there were even years where it didn't pay and so technically defaulted upon them.

The rest of Europe meanwhile had to pay back the cost of war and rebuilding funds. The war didn't just stunt the European economies, it sent many into a long decline.

Long decline? I'd have more of a case of the end of the Cold War doing more damage to Balkan economies than the recovery that initiated post-WW2. Macedonia's GDP for example was $15 billion or so and dropped to $2 billion at the eve of Yugoslavia collapse. The drastic drop is from the embargo on the Yugoslavian common market and the Greek embargo. We practically had no market to sell our products to for 5 years. Bulgaria also suffered heavily from the Eastern bloc collapse where its GDP actually dropped by 58% 1990-1997.

While I won't deny that WW2 did a bit of damage to Greek economy but you can't say it hasn't recovered from the damages. Greek GDP is $300 billion which is quite good for a country of 10.5 million. The only problem with Greek economy is it has too much state employees and too much state employees pensions to pay. Not having any industry besides tourism also didn't help them since that means less taxes and less taxes = harder time covering state wages and pensions.

[Queen B]

While I won't deny that WW2 did a bit of damage to Greek economy but you can't say it hasn't recovered from the damages.
http://en.wikipedia.org/wiki/World_War_II_casualties
http://en.wikipedia.org/wiki/Great_Famine_%28Greece%29
http://en.wikipedia.org/wiki/Axis_occupation_of_Greece_during_World_War_II
A bit? A bit?


Greek GDP is $300 billion which is quite good for a country of 10.5 million. The only problem with Greek economy is it has too much state employees and too much state employees pensions to pay. Not having any industry besides tourism also didn't help them since that means less taxes and less taxes = harder time covering state wages and pensions.
Another myth. Greece has less than many other EU countries.
See the discussion here, (http://www.theapricity.com/forum/showpost.php?p=837689&postcount=148) have talked about it with Civis. Less than France, UK, Sweden or Denmark.

[Albion]

Long decline? I'd have more of a case of the end of the Cold War doing more damage to Balkan economies than the recovery that initiated post-WW2.

That too but some states have themselves to blame for that. BTW, Europe doesn't end at the Balkans - the western half of the continent was gutted too whilst whole empires crumbled thanks to that war.


Macedonia's GDP for example was $15 billion or so and dropped to $2 billion at the eve of Yugoslavia collapse. The drastic drop is from the embargo on the Yugoslavian common market and the Greek embargo. We practically had no market to sell our products to for 5 years. Bulgaria also suffered heavily from the Eastern bloc collapse where its GDP actually dropped by 58% 1990-1997.

Well once your main trading partners started toppling like dominoes I'd think it quite obvious what would happen. Also the change in economic systems was bound to have a huge affect and capitalism can hardly be called a force for good.


While I won't deny that WW2 did a bit of damage to Greek economy but you can't say it hasn't recovered from the damages.

I don't think anyone is saying that. The posts are meant to highlight that Germany is hardly the saint it is portrayed as when it comes to economic matters.
German economic stability is of recent origin and preaching to the Greeks isn't helping resolve the crisis.

Germany played a major part in creating the crisis by propping up much of Europe to ensure its own export market. Why? Well because most of the world is simply too poor to buy many German goods at their prices so the European and North American continents represent the only significant markets.


The only problem with Greek economy is it has too much state employees and too much state employees pensions to pay. Not having any industry besides tourism also didn't help them since that means less taxes and less taxes = harder time covering state wages and pensions.

Bingo. But the Eurozone countries kept providing the money regardless of whether Greece was in a good economic shape or not.
Some accountability on the side of the lenders has to be taken, Greece was receiving the money but why were other countries providing it in the first place?

Why was Greece allowed to join the Eurozone if it wasn't suited to it? It can't adjust (manipulate) the currency to suit its own needs and is basically tied to stronger economies such as Germany's.
When Britain dropped out of the ERM it should have been a wake up call for proponents of a single currency - don't let in countries that aren't suited to it.

Did they learn? No. Not only did they allow Greece et al in but also kept pestering Britain to join, the country which had so badly taken a hit the last time the prototype to it was attempted.
Soros made a killing and Britain was disgraced, but after that it actually experienced very good growth for a number years after it was freed from being pegged to the German economy.

[Petros Houhoulis]

It seems that the profit like almost always goes to the few rich ones. In Greece there is a lot of corruption and from what I know there somehow are 2 big political "families" which let rule each other for a while.
Greece has to deal with it's corruption and it's somewhat inefficient governance system and especially it's financial department.
Of course nobody denies people the right to get salaries they can live off.

Actually the families are three, and for all intents and purposes they are out of the political arena by now.

The problem goes much beyond a few families though. We won't get better just because we got rid of them..

[2Cool]

Their actions? They were the ones who rescued Greece.

lol. Germany is not rescuing Greece, it's rescuing its banks.

[Petros Houhoulis]

Of course they have to face competition.

I could go out and buy a ford focus or fiat that costs much less than a VW or Merc or BMW or AUDI but i will go for the German car even though it costs more.....why..?
Quality thats why.....the Germans produce quality and are a byword for it.

People should stop knocking them out of petty jealousy and start to imitate them and then maybe their fucked up countries will be as streamlined and advanced as they are.

Easier said than done, but we must...

[Arne]

Rofl , we all will get rich..
Damn, it was only a dream.

[Petros Houhoulis]

Rofl , we all will get rich..
Damn, it was only a dream.

We are all rich...

List of countries by percentage of people living with less than $2 per day (2009):

http://upload.wikimedia.org/wikipedia/en/7/71/Percentage_population_living_on_less_than_%242_per _day_2009.png

...But we live amongst equally rich people, more or less...

[Arne]

We are all rich...

List of countries by percentage of people living with less than $2 per day (2009):

...But we live amongst equally rich people, more or less...

Is it really the Fault of the richer Countries or do these developing countries can not spread the money fair over the population..
Greeks always blamed Germans generally from what i´d noticed.
Maybe we shouldn´t supported greece, cause they doesn´t seem to wanted it.

[Fortis in Arduis]

I've got a German boiler and set top box. Both are shit and required my engineering genius to fix them on the many times they broke down.

The whole stereotypes about German products being quality and Chinese ones being crap is just a generalisation. There's truth in it of course but don't take it as the bible.

Yeah, I have a Miele vacuum cleaner and it really sucks. :(

[Arne]

Yeah, I have a Miele vacuum cleaner and it really sucks. :(

German Products ain´t what they were once.:( So sad

[Petros Houhoulis]

Is it really the Fault of the richer Countries or do these developing countries can not spread the money fair over the population..
Greeks always blamed Germans generally from what i´d noticed.
Maybe we shouldn´t supported greece, cause they doesn´t seem to wanted it.

Who suggested that the rich countries have an obligation to sustain the poor ones?

The Germans must decide if they want a united Europe with common borders or not. We need to know if we shall guard the Greek borders, or if they shall lend a hand at the common borders of Europe.

They enjoy the Free trade agreements while we "enjoy" the Turks...

[Petros Houhoulis]

German Products ain´t what they were once.:( So sad

All products are fake, especially their electronic parts.

The richer countries should stop manufacturing fake goods, instead of subsidizing the poor countries.

[Albion]

All products are fake, especially their electronic parts.

The richer countries should stop manufacturing fake goods, instead of subsidizing the poor countries.

What are you talking about? We should manufacture our own products and limit imports from Asia more like.

Eastern Europe could make cheap electronics as China does now whilst the west could focus on more high end manufacturing.

[Graham]

A weak Euro is also helping Germany in some ways. Good for it's trade outside the Eurozone. It's in their best interest, to muck your country up and to stay in the Eurozone.

[Rouxinol]

That German economy and its judeo-masonic banksters are profitting from the debt crisis in the eurozone comes as no surprise. Unfortunately I think that it has come the time to put a full stop on German interests against other Europeans once again. In some ways maybe the withdrawal of Greece from the eurozone would be beneficial if it happens to spread to Portugal and Ireland, then Spain and Italy, then probably France and finally the total collapse of the eurozone and of the Germa... European Union.

[Graham]

Eurozone economy posts zero growth in first quarter
15 May 2012 Last updated at 10:47

The eurozone has narrowly avoided returning to recession after recording zero growth in the first three months of the year, figures have shown.

The stronger-than-expected performance was in large part due to growth of 0.5% in the German economy....
http://www.bbc.co.uk/news/business-18068747

[poiuytrewq0987]

Eurozone economy posts zero growth in first quarter
15 May 2012 Last updated at 10:47

The eurozone has narrowly avoided returning to recession after recording zero growth in the first three months of the year, figures have shown.

The stronger-than-expected performance was in large part due to growth of 0.5% in the German economy....
http://www.bbc.co.uk/news/business-18068747

Yay, austerity?

[Aces High]

I think that it has come the time to put a full stop on German interests against other Europeans once again.

What time does the first bombing raid start........and should we start digging trenches in Green park or wait a while.

[Breedingvariety]

What time does the first bombing raid start........and should we start digging trenches in Green park or wait a while.
If you are defeatist- start digging. If you are idealist- wait for the next offensive and wunderwaffe.

[Petros Houhoulis]

What are you talking about? We should manufacture our own products and limit imports from Asia more like.

Eastern Europe could make cheap electronics as China does now whilst the west could focus on more high end manufacturing.

I mean that Germany (or put any other rich Western country here) could start making products that last longer like in the good old times instead of selling fragile things that last a few years resulting to booming German (or put any other rich Western country here) exports at the expense of the European periphery.

Ultimately, your suggestion is the only solution to our problems. Nothing else shall work.

BTW, add the Balkans to Eastern Europe too...

[Petros Houhoulis]

What time does the first bombing raid start........and should we start digging trenches in Green park or wait a while.

I am displeased to inform you that the rules of war have changed. The most popular trend is asymmetrical warfare, but I would expect you to know better than I do by now...

http://en.wikipedia.org/wiki/7_July_2005_London_bombings
http://en.wikipedia.org/wiki/21_July_2005_London_bombings

We live in treacherous times...

[Graham]

Germany hasn't faired badly going by GDP. Apart from the banking crisis in 2008.
http://i.dailymail.co.uk/i/pix/2012/05/17/article-2145139-131DD08D000005DC-478_634x589.jpg

[Petros Houhoulis]

Germany hasn't faired badly going by GDP. Apart from the banking crisis in 2008.
http://i.dailymail.co.uk/i/pix/2012/05/17/article-2145139-131DD08D000005DC-478_634x589.jpg

That's because the Germans are not flooded with bankers and stockbrokers like "the City" is, and there are not so many crooks around like in the other European countries...

Yet the Germans are using the Euro at their advantage, no doubt.