Morning Must-Read: Wolfgang Münchau: Germany’s Weak Point Is Its Reliance on Exports
…The root cause of the problem is the age-old over-reliance on exports–and on plant and machinery exports in particular…. There are no signs of a strong global recovery, let alone of a global investment boom. It is thus reasonable to expect a mediocre performance by the German economy for a while…. On top of that comes a demographic shock…. Now both the core and the periphery are weak. And policy is not responding sufficiently. Add the two together and it is not hard to conclude that secular stagnation is not so much a danger as the most probable scenario.
Hope is not a plan.